2017 AFR National Govt Volume I

FY 2017
Annual Financial Report
National Government
Volume I
EXECUTIVE SUMMARY
EXECUTIVE SUMMARY
Legal Framework
The Commission on Audit (COA) prepares the Annual Financial Report (AFR) for the
National Government (NG) to keep its mandate under the 1987 Philippine Constitution
and the Government Auditing Code of the Philippines (P.D. No. 1445).
Specifically, the 1987 Constitution, under Section 4, Article IX-D states that: “The
Commission shall submit to the President and the Congress, within the time fixed by law,
an annual report covering the financial condition and operation of the Government, its
subdivisions, agencies, and instrumentalities, including government-owned or controlled
corporations, and non-governmental entities subject to its audit, and recommend measures
necessary to improve their effectiveness and efficiency. It shall submit such other reports
as may be required by law.”
Further, pursuant to Section 41 (1) of P.D. No. 1445, the Commission shall submit to the
President and the Congress not later than the last day of September of each year an Annual
Report of the financial condition and results of operation of all agencies of the government
which shall include recommendations of measures necessary to improve the efficiency and
effectiveness of these agencies.
The Government Accountancy Sector (GAS) is tasked to prepare the AFR for the NG
pursuant to COA Resolution No. 2013-021 dated November 20, 2013, the Restructuring
of the GAS of this Commission.
The COA, through COA Resolution No. 2014-003 dated January 24, 2014, prescribed the
adoption of the Philippine Public Sector Accounting Standards (PPSAS), which are
aligned to the prevailing International Public Sector Accounting Standards. The
implementation of the PPSAS aims to enhance the quality and uniformity in financial
reporting by Philippine public sector entities, and to ensure accountability, transparency
and comparability of financial information with other public sector entities across the
globe. Consequently, COA issued COA Circular No. 2015-007 dated October 22, 2015
prescribing the use of the Government Accounting Manual (GAM) for National
Government Agencies (NGAs) that provides updated accounting guidelines and
procedures to implement the PPSAS.
Objectives
This AFR is prepared to provide essential information on the financial position, financial
performance, changes in net assets/equity, cash flows, and comparison of budget and
actual amounts of NGAs. It also provides information on appropriations, allotments,
obligations, disbursements, unreleased appropriations, and unobligated balances, as well
as the summary of the results of audit, specifically audit opinions on the financial
statements (FSs) and significant audit recommendations on economy, efficiency, and
effectiveness of operation of NGAs.
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The financial information will serve as useful tool for the President, as overall head of the
government; the Congress, in the promulgation of laws and in performing its oversight
function in the budget process; and other oversight government agencies and heads of
agencies, for sound decision towards efficient and effective utilization of government
resources and delivery of services to the public.
The AFR also caters to the information needs of the public, as stakeholder and user of data,
in consonance with the fiscal policy of improved transparency and public accountability.
Contents
The AFR is composed of two volumes. Volume I is composed of the following parts:
Part Particulars
I Financial Highlights
II Appropriations, Allotments, Obligations, Disbursements, and Balances
III Current Surplus of the National Government
IV Financial Statements
V National Government Debt
VI Summary of Audit Opinions
VII Significant and Common Audit Observations and Recommendations
VIII Highlights of Accomplishments of the Top Ten Departments
Financial Highlights
The aggregate amount of the NG’s assets, liabilities and net assets/equity for FY 2017
amounted to P5.247 trillion, P7.105 trillion, and negative P1.858 trillion, respectively. In
comparison with FY 2016 balances, total assets increased by 11.72 percent, total liabilities
increased by 8.62 percent, and the negative balance of net assets/equity decreased by 0.73
percent.
For FY 2017, total revenue of the NG amounted to P2.524 trillion, posting an increment
of 13.18 percent from the previous year’s revenue of P2.230 trillion. Total current
operating expenses amounting to P1.537 trillion increased by 10.16 percent compared to
prior year’s amount of P1.396 trillion. After adding the negative net financial
assistance/subsidy of P802.51 billion, losses of P38.06 billion, and the non-operating
income of P10.18 billion to surplus from current operations of P986.16 billion, the
operations of the NG for FY 2017 resulted in a surplus of P155.77 billion.
Appropriations, Allotments, Obligations, Disbursements, and Balances
In performing its constitutional mandate, the COA, through the GAS, keeps the following
registries:
1. Registry of Appropriations and Allotments (RAPAL) to record and monitor the

appropriations authorized by law and the allotments released by the Department
of Budget and Management (DBM) to the NGAs and some GCs;
2. Registry of Allotments, Obligations and Disbursements (RAOD) to record the
allotments, obligations, and disbursements;
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3. Registry of Overdraft in Allotments (ROA) to record overdraft in allotments; and
4. Registry of Revenue (RR) to record the revenue that accrue to the General Fund
(GF).
These registries are maintained using budget data from the DBM and the Budget and
Financial Accountability Reports (BFARs) submitted by NGAs.
Based on the said registries, the following statements and/or schedules were prepared and
included in this Report:
1. Statement of Appropriations, Allotments, Obligations, and Disbursements

(SAAOD), which presents the authorized appropriations and adjustments,
adjusted allotments, obligations covered and not covered by allotments,
disbursements for payment of current year’s obligations, unreleased
appropriations, unobligated allotments, and unpaid obligations;
2. Statement of Appropriations, Allotments, Obligations, and Balances (SAAOB),
which shows the authorized appropriations and adjustments, adjusted allotments,
obligations covered and not covered by allotments, unreleased appropriations, and
unobligated allotments for reversion and retention;
3. Statement of Current Surplus (SCS), which shows total current surplus,
unappropriated surplus, unreleased appropriations, unobligated allotments, and if
any, overdraft in allotments;
4. Schedule of Continuing Appropriations (SCA); and
5. Schedule of Overdrafts in Allotments (SOA).
For FY 2017, the NG had total appropriations of P4.113 trillion; total allotments of P3.798
trillion, of which P1.87 million was to cover prior year’s overdraft; total obligations of
P3.466 trillion, of which P864.20 million was not covered by allotments; and total
disbursements of P2.624 trillion; thus, leaving an unreleased appropriations of P315.44
billion, unobligated allotments of P332.55 billion, and unpaid obligations of P842.49
billion.
Current Surplus
The Current Surplus of the NG is the net balance of the combined figures of the following
components: unappropriated surplus, unreleased continuing appropriations and
unobligated continuing appropriations, and overdraft in allotments.
The overall ending balance of the Current Surplus amounted to P939.10 billion, broken
down as follows: unappropriated surplus – P922.05 billion, unreleased continuing
appropriations – P4.83 billion, unobligated continuing appropriations – P13.54 billion, and
overdraft in allotments – P1.32 billion.
Financial Statements
The consolidated financial statements (FSs) presented in this Report was taken from the
FY 2017 and restated FY 2016 FSs of 318 NGAs and 3 GCs, namely: Cultural Center of
the Philippines, National Tobacco Administration, and Philippine Coconut Authority,
which are maintaining Special Account in the General Fund (SAGF).
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As required in the GAM for NGAs, enhanced Unified Accounts Code Structure, and other
relevant government accounting rules and regulations, the FSs should be prepared by the
NGAs by fund cluster, as follows:
Code Description
01 Regular Agency Fund
02 Foreign Assisted Projects Fund
03 Special Accounts-Locally Funded/Domestic Grants Fund
04 Special Accounts-Foreign Assisted/Foreign Grants Fund
05 Internally Generated Fund
06 Business Related Funds
07 Trust Receipts
However, some NGAs did not submit FSs by fund cluster, thus, the following consolidated
FSs presented in this Report were not prepared by fund cluster:
1. Statement of Financial Position (SFPos), which presents the assets and liabilities
classified as current and non-current, and the equity of the NG;
2. Statement of Financial Performance (SFPer), which presents the revenue,
expenses, net financial subsidy, gains or losses, and net surplus/(deficit) for the
period;
3. Statement of Changes in Net Assets/Equity (SCNA/E), which presents the net
surplus for the period, effects of changes in accounting policies, and prior period
and other adjustments;
4. Statement of Cash Flows (SCF), which presents the sources (cash inflows) and
utilizations (cash outflows) of funds;
5. Statement of Comparison of Budget and Actual Amounts (SCBAA), which
presents comparative budget information on the original and final budget, and
actual receipt and utilization of funds; and
6. Notes to Financial Statements, which presents additional and relevant information
and disclosures on the data presented in the consolidated FSs and information
about items that do not qualify for recognition in those statements.
National Government Debt
In monitoring the availment and repayment of domestic and foreign loans, and issuance
and redemption of treasury bills and bonds of the NG, the COA maintains a Registry of
Domestic and Foreign Borrowings (RDFB) based on the monthly and quarterly reports of
borrowings submitted by the Bureau of the Treasury (BTr).
Based on the RDFB, the following schedules were prepared and included in this Report:
1. Schedule of Commitment Fees Paid;

2. Schedule of Outstanding Foreign Borrowings, by Classification;
3. Schedule of Outstanding Foreign Borrowings, by Creditor;
4. Schedule of Domestic Debt Securities (treasury bills and treasury bonds); and
5. Schedule of Outstanding Domestic Loans (actual and guaranteed).
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The outstanding balance of the NG debt as at December 31, 2017 amounted to P7.131
trillion, composed of domestic borrowings of P4.639 trillion or 65.06 percent, and
foreign borrowings of P2.492 trillion or 34.94 percent.
Summary of Audit Opinions, and Significant and Common Audit

Observations and Recommendations
This Report includes a summary of the results of audit conducted on each NGA.
Specifically, it presents a summary of audit opinions on the FSs, and significant and
common audit observations and corresponding audit recommendations towards efficient
and effective operations of the NGAs. The audit opinion rendered on the fairness of
presentation of each NGA’s FSs was a representation and sole responsibility of the auditor
concerned.
Highlights of Accomplishments of the Top Ten Departments
This AFR also highlights the accomplishments taken from the respective Annual Reports
for FY 2017 of the following departments identified as top ten based on the amount of
their respective approved appropriations:
1. Department of Education;
2. Department of Public Works and Highways;
3. Department of National Defense;
4. Department of the Interior and Local Government;
5. Department of Social Welfare and Development;
6. Department of Health;
7. Department of Transportation;
8. Department of Agriculture;
9. Department of Environment and Natural Resources; and
10. Department of Finance.
Volume II presents the detailed FSs of the NG by department, including the pertinent
supporting schedules.
Methodology
Financial information was obtained from the audited and advanced copies of the FSs of
318 NGAs and 3 GCs maintaining SAGF. Change in the number of agencies reported in
previous year was due to: (a) inclusion of the FSs of the Overseas Workers Welfare
Administration which is now an attached agency of the Department of Labor and
Employment pursuant to Republic Act No. 10801; (b) non-submission of FSs by the
Commission on Elections; and (c) non-inclusion of the FSs for SAGF of the Tourism
Promotions Board as they were integrated in its Corporate Fund and were reported in the
AFR for GCs.
Trial Balances (TBs) and FSs were submitted by the agencies to the COA-GAS through
the Annual Financial Reporting System (AFRS), a web-based application system
developed by COA-GAS to facilitate online submission of the Pre-Closing TBs, FSs, and
Statement of Management’s Responsibility. In addition, the agencies submitted printed
and/or electronic copies of their TBs and FSs. The COA-GAS analyzed the individual FSs,
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reconciled budgetary information with the DBM, verified deficiencies noted with agencies
concerned, and prepared the consolidated FSs by department and for the entire NG. Intra-
agency and inter-agency accounts, to a great extent, were eliminated based on combined
FSs of the NG.
All amounts presented in this Report are expressed in Philippine peso, rounded off to the
nearest thousands, unless otherwise stated. The difference between the totals and sum of
components is due to rounding off.
Guide to Users
For enhanced financial reporting and greater transparency, the electronic copy of this
Report is posted and can be downloaded from the COA website (www.coa.gov.ph).
The complete details of the audit opinions, and audit observations and recommendations
are presented in the individual Annual Audit Reports on the NGAs and are also posted on
the same website.
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TABLE OF CONTENTS
VOLUME I
Part Page
I FINANCIAL HIGHLIGHTS
Financial Position 1
Financial Performance 6
Changes in Net Assets/Equity (Accumulated Surplus/Deficit) 9
Cash Flows 9
Comparison of Budget and Actual Amounts 10
II APPROPRIATIONS, ALLOTMENTS, OBLIGATIONS,

DISBURSEMENTS AND BALANCES
Budget for Fiscal Year 2017 12
Appropriations, Allotments, Obligations, and Disbursements for FY 2017 13
Appropriations 15
Allotments 18
Appropriations and Allotments for Foreign-Assisted Projects 24
Unreleased Appropriations 26
Obligations 31
Overdraft in Allotments 33
Unobligated Allotments 35
Disbursements 38
Unpaid Obligations 39
III CURRENT SURPLUS OF THE NATIONAL GOVERNMENT

Legal Framework 43
Current Surplus of the National Government 44
Unappropriated Surplus 45
Unreleased Continuing Appropriations 45
Unobligated Continuing Appropriations 45
Overdraft in Allotments 46
IV COMPARATIVE FINANCIAL STATEMENTS

Statement of Financial Position - FY 2017 and FY 2016 Restated 47
Statement of Financial Performance - FY 2017 and FY 2016 Restated 48
Statement of Cash Flows - FY 2017 and FY 2016 Restated 49
Statement of Changes in Net Assets/Equity – FY 2017 and FY 2016 Restated 50
Statement of Comparison of Budget and Actual Amounts 51
Notes to Financial Statements 52
TABLE OF CONTENTS
VOLUME I
Part Page
V NATIONAL GOVERNMENT DEBT 228
VI SUMMARY OF AUDIT OPINIONS 238
VII SIGNIFICANT AND COMMON AUDIT OBSERVATIONS AND

RECOMMENDATIONS 343
VIII HIGHLIGHTS OF ACCOMPLISHMENTS OF TOP TEN

DEPARTMENTS
Department of Education 469
Department of Public Works and Highways 481
Department of the Interior and Local Government 487
Department of National Defense 505
Department of Social Welfare and Development 521
Department of Health 528
Department of Transportation 542
Department of Agriculture 563
Department of Environment and Natural Resources 580
Department of Finance 614
IX ANNEXES
A - List of NGAs which submitted their FSs for FY 2017 638
B - Original Budgeted Receipts 645
C - Final Budgeted Receipts 647
D - Actual Receipts 649
E - Difference between Final Budgeted Receipts and Actual Receipts 651
F - Original Budgeted Payments 653
G - Final Budgeted Payments 655
H - Actual Payments 657
I - Difference between the Final Budgeted Payments and Actual Payments 659
J - Net Receipts/Payments 661
LIST OF TABLES AND CHARTS
TABLES Page
I.A.1 Current Assets 2

I.A.2 Non – Current Assets 3
I.A.3 Current Liabilities 4
I.A.4 Non-Current Liabilities 5
I.A.5 Net Assets/Equity of the National Government 6
I.B.1 Financial Performance of the National Government 6
I.B.2 Net Financial Assistance/Subsidy 8
I.C.1 Accumulated Surplus/(Deficit) 9
II-1 Annual Budget, Fiscal Years 2009 to 2017 13
II-2 Comparative Appropriations, Allotments, Obligations,
Disbursements and Balances 14
II-3 Comparative Appropriations by Source 15
II-4 Appropriations by Department/Office by Source 17
II-5 Comparative Appropriations of Top Ten Departments/Offices 18
II-6 Comparative Allotments by Source 19
II-7 Allotments from Special Purpose Fund by Source 20
II-8 Allotments for Budgetary Support to GOCCs
by Government Corporation, by Purpose 21
II-9 Allotments by Department/Office and by Source 23
II-10 Comparative Allotments of Top Ten Departments/Offices 24
II-11 Appropriations for Foreign-Assisted Projects, by Department/Office, by
Allotment Class 25
II-12 Allotments for Foreign-Assisted Projects, by Department/Office, by
Allotment Class 26
II-13 Appropriations, Allotments and Unreleased Appropriations 26
II-14 Comparative Unreleased Appropriations by Source 28
II-15 Unreleased Appropriations from Special Purpose Funds 28
II-16 Comparative Unreleased Appropriations of Top Ten Departments/Offices 30
II-17 Unreleased Appropriations by Source, by Department/Office 30
II-18 Comparative Obligations, by Source 32
II-19 Obligations by Source, by Department/Office 33
II-20 Departments/Agencies with Overdraft 34
II-21 Comparative Obligations of Top Ten Departments/Offices 35
II-22 Allotments, Obligations and Unobligated Allotments, by
Department/Office 35
II-23 Comparative Unobligated Allotments, by Source 37
II-24 Comparative Unobligated Allotments of Top Ten Departments/Offices 37
II-25 Comparative Disbursements by Department/Office 38
II-26 Comparative Obligations, Disbursements and Unpaid Obligations, by
Department/Office 40
LIST OF TABLES AND CHARTS
TABLES Page
II-27 Comparative Unpaid Obligations by Department/Office 41
CHARTS Page
I.A.1 Financial Position for FYs 2017 and 2016 (in billion pesos) 1
I.A.2 Composition of Current Assets (in billion pesos) 2
I.A.3 Composition of Non-Current Assets (in billion pesos) 3
I.A.4 Composition of Current Liabilities (in billion pesos) 4
I.A.5 Composition of Non-Current Liabilities (in billion pesos) 5
I.B.1 Total Revenue (in billion pesos) 7
I.B.2 Current Operating Expenses (in billion pesos) 8
I.D.1 Cash Flows, by Activity (in billion pesos) 10
II-1 Trend Analysis of Appropriations, Allotments and Obligations (in billion
pesos) 15
II-2 Appropriations by Allotment Class (in billion pesos) 16
II-3 Comparative Allotments by Class (in billion pesos) 19
II-4 Unreleased Appropriations by Allotment Class (in billion pesos) 27
II-5 Comparative Obligations, by Allotment Class (in billion pesos) 32
II-6 Comparative Unobligated Allotments, by Class (in billion pesos) 36
II-7 Comparative Disbursements by Allotment Class (in billion pesos) 38
II-8 Comparative Unpaid Obligations by Allotment Class (in billion pesos)
40
I. FINANCIAL
HIGHLIGHTS
PART I – FINANCIAL HIGHLIGHTS
A. FINANCIAL POSITION
The Statement of Financial Position (SFPos) shows the assets and liabilities classified as
current and non-current, and the net assets/equity of the National Government (NG).
As at December 31, 2017, the aggregate assets and liabilities of the NG were posted at
P5.247 trillion and P7.105 trillion, respectively, resulting in a negative net assets/equity of
P1.858 trillion. Previous year’s total assets of P4.697 trillion increased by P550.40 billion
or 11.72 percent; liabilities of P6.541 trillion increased by P563.85 billion or 8.62 percent,
and net assets/equity of negative P1.845 trillion increased by negative P13.44 billion or
0.73 percent.
Chart I.A.1 Financial Position for FYs 2017 and 2016

(in billion pesos)
8,000.00 7,105.21
6,541.36 FY 2017
7,000.00
FY 2016
6,000.00 5,247.25
4,696.85
5,000.00
4,000.00
3,000.00
2,000.00
1,000.00
0.00
ASSETS LIABILITIES NET ASSETS
(1,000.00)
(2,000.00)
(1,857.96) (1,844.52)
(3,000.00)
ASSETS – P5.247 trillion
Total assets of P5.247 trillion is composed of current assets of P1.428 trillion and non-
current assets of P3.820 trillion.
Current Assets – P1.428 trillion
Current assets of P1.428 trillion constituted 27.21 percent of the total assets. It increased
by P334.09 billion or 30.55 percent from the previous year total of P1.094 trillion. Of the
total increase, cash and cash equivalents posted the highest amount of P199.60 billion or
529.08 percent. It was followed by receivables – P67.08 billion or 8.51 percent, other
current assets – P24.47 billion or 19.36 percent, inventories – P24.24 billion or 36.81
percent, and investments – P18.70 billion or 24.68 percent.
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Chart I.A.2 presents the composition of current assets while Table I.A.1 shows the
comparison of current assets for FYs 2017 and 2016.
Chart I.A.2 Composition of Current Assets

(in billion pesos)
Other Current Cash and Cash

Assets Equivalent
150.85 237.33
10.57% 16.62%
Inventories
90.09 Investments
6.31% 94.47
Receivables 6.62%
854.92
59.88%
Table I.A.1 Current Assets
Amount
(in million pesos)
Particulars Percent
2016 Increase/
2017
(Restated) (Decrease)
Cash and Cash Equivalents 237,331.70 37,726.75 199,604.94 529.08
Investments 94,465.13 75,765.94 18,699.19 24.68
Receivables 854,917.54 787,841.07 67,076.47 8.51
Inventories 90,091.46 65,853.11 24,238.35 36.81
Other Current Assets 150,852.72 126,383.38 24,469.34 19.36
Total 1,427,658.54 1,093,570.25 343,088.29 30.55
Total cash and cash equivalents of the NG amounted to P714.26 billion but was reduced
to P237.33 billion due to the total negative balance of P476.93 billion composed of Cash-
Treasury/Agency Deposit, Special Account and Cash-Treasury/Agency Deposit, Trust
amounting to P384.07 billion and P92.86 billion, respectively. The details are discussed in
the Consolidated Notes to Financial Statements.
Non-Current Assets – P3.820 trillion
Non-current assets of P3.820 trillion accounted for 72.79 percent of the total assets. It
registered an increase of P216.32 billion or 6 percent compared to FY 2016 of P3.603
trillion. The increment was due primarily to the increase in property, plant and equipment
(PPE) of P320.07 billion or 14.71 percent. The increase was partially reduced by the
decrease in investments of P111.22 billion or 10.05 percent. Among the components of
the non-current assets, the highest percentage increase was reported for intangible assets
at 57.54 percent. Table I.A.2 shows the comparison of non-current assets for FYs 2017
and 2016.
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Table I.A.2 Non-Current Assets
Amount
(in million pesos)
Particulars Percent
2016 Increase/
2017
Investments 995,205.69 1,106,420.92 (111,215.22) (10.05)
Receivables 203,481.17 200,276.49 3,204.67 1.60
Investment Property 2,159.38 2,699.79 (540.41) (0.20)
Property, Plant and Equipment 2,496,282.52 2,176,209.17 320,073.35 14.71
Biological Assets 1,478.26 1,942.53 (464.26) (23.90)
Intangible Assets 4,533.73 2,877.87 1,655.86 57.54
Other Non-Current Assets 116,449.87 112,848.72 3,601.15 3.19
Total 3,819,590.61 3,603,275.48 216,315.13 6.00
The biggest components of non-current assets are PPE and investments, accounting for
65.36 percent and 26.06 percent, respectively. Chart I.A.3 shows the composition of non-
current assets.
Chart I.A.3 Composition of Non-Current Assets

(in billion pesos)
995.21
26.06% 203.48
5.33%
116.45
3.05%
4.53
0.12%
2.16
0.06%
2,496.28 1.48
65.35% 0.04%
Property, Plant and Equipment Investments Receivables

Other Non-Current Assets Intangible Assets Investment Property
Biological Assets
LIABILITIES – P7.105 trillion
Total liabilities of P7.105 trillion increased by P563.85 billion or 8.62 percent from
previous year’s P6.541 trillion. A total of P5.938 trillion or 83.58 percent constitutes non-
current liabilities while P1.167 trillion or 16.42 percent represents current liabilities.
Current Liabilities – P1.167 trillion
Current liabilities of P1.167 trillion was higher by P79.62 billion or 7.32 percent than
previous year of P1.087 trillion. This was due to the increase in financial liabilities of
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P105.00 billion or 11.90 percent, inter-agency payables of P1.66 billion or 2.68 percent,
intra-agency payables of P131.88 million, trust liabilities of P13.52 billion or 25.69 percent
and provisions of P13.78 million or 29.09 percent, which were partially offset by the
decrease in other payables of P40.15 billion or 47.19 percent, and deferred
credits/unearned income of P540.79 million or 9.91 percent. Table I.A.3 shows the
comparison of current liabilities for FYs 2017 and 2016.
Table I.A.3 Current Liabilities
Amount
(in million pesos)
Particulars Percent
2016 Increase/
2017
Financial Liabilities 987,220.73 882,225.36 104,995.37 11.90
Inter-Agency Payables 63,459.60 61,802.23 1,657.37 2.68
Intra-Agency Payables 131.88 - 131.88 -
Trust Liabilities 66,122.09 52,606.04 13,516.05 25.69
Other Payables 44,928.64 85,081.07 (40,152.43) (47.19)
Deferred Credits/Unearned Income 4,918.20 5,458.98 (540.79) (9.91)
Provisions 61.16 47.38 13.78 29.09
Total 1,166,842.29 1,087,221.07 79,621.22 7.32
The biggest component of current liabilities represents financial liabilities of P987.22

billion or 84.61 percent. Financial liabilities include the current portion of public debt,
both foreign and domestic in the amount of P687.97 billion, of which, 98.59 percent or
P601.06 billion was reported by the BTr, the agency mandated to manage, control and
service the public debt of the NG. Chart I.A.4 shows the composition of current liabilities.
Chart I.A.4 Composition of Current Liabilities

(in billion pesos)
66.12
5.67% 63.46
5.44%
44.93
3.85%
4.92
0.42%
987.22 0.13
84.61% 0.01%
0.06
0.01%
Financial Liabilities Trust Liabilities
Inter-Agency Payables Other Payables
Deferred Credits/Unearned Income Intra-Agency Payables
Provisions
4
Non-Current Liabilities – P5.938 trillion
Non-current liabilities increased by P484.23 billion or 8.88 percent compared to the

previous year of P5.454 trillion. This was due to the increase in the balances of financial
liabilities of P473.99 billion or 8.79 percent, trust liabilities of P4.24 billion or 37.11
percent, deferred credits/unearned income of P1.26 billion or 4.80 percent, other payables
of P5.65 billion or 23.55 percent, and offset by the decrease in provisions of P916.07
million or 31.44 percent. Table I.A.4 shows the comparison of FYs 2017 and 2016 non-
current liabilities.
Table I.A.4 Non-Current Liabilities
Amount
(in million pesos)
Particulars Percent
2016 Increase/
2017
Financial Liabilities 5,863,483.59 5,389,492.34 473,991.25 8.79
Trust Liabilities 15,647.42 11,411.90 4,235.51 37.11
Deferred Credits/Unearned Income 27,578.55 26,315.42 1,263.13 4.80
Other Payables 29,660.42 24,007.63 5,652.78 23.55
Provisions 1,997.84 2,913.91 (916.07) (31.44)
Total 5,938,367.82 5,454,141.21 484,226.61 8.88
Of the total non-current liabilities, P5.863 trillion or 98.74 percent represents financial
liabilities. This amount includes P5.852 trillion pertaining to the non-current portion of
public debt, both foreign and domestic, of which P5.851 trillion or 99.99 percent was
reported by the BTr. Chart I.A.5 shows the composition of non-current liabilities.
Chart I.A.5 Composition of Non-Current Liabilities

(in billion pesos)
27.58
0.46%
29.66
0.50%
5,863.48
98.74% 15.65
0.26%
2.00
0.03%
Financial Liabilities Other Payables

Deferred Credits/Unearned Income Trust Liabilities
Provisions
5
NET ASSETS/EQUITY – (P1.858 trillion)
As in prior years, liabilities of the NG exceeded the assets resulting in a negative balance
of P1.858 trillion in equity. The FY 2016 negative balance of P1.845 trillion further
increased by P13.44 billion or 0.73 percent in FY 2017. The negative balance of P1.858
trillion is composed of the negative balance of government equity of P1.859 trillion, and
the unrealized gain of P923.18 million. Table I.A.5 shows the net assets/equity for FYs
2017 and 2016.
Table I.A.5 Net Assets/Equity of the National Government
Amount
(in million pesos)
Particulars Percent
2016 Increase/
2017
Government Equity (1,858,884.14) (1,859,166.68) 282.55 (0.02)
Accumulated Surplus/(Deficit) (1,881,136.21) (1,935,204.80) 54,068.60 (2.79)
Contributed Capital 8.00 8.00 - -
Revaluation Surplus 22,244.07 76,030.12 (53,786.05) (70.74)
Unrealized Gain/(Loss) 923.18 14,650.14 (13,726.96) (93.70)
Unrealized Gain/(Loss) from Changes
in Fair Value of Financial Assets 923.18 14,650.14 (13,726.96) (93.70)
Net Assets/Equity (1,857,960.96) (1,844,516.54) (13,444.42) (0.73)
B. FINANCIAL PERFORMANCE
The Statement of Financial Position (SFPer) reflects the generated revenue/gains from
various sources, expenses incurred by allotment class including losses from various
transactions, and the surplus/(deficit) during the year.
For FY 2017, the NG realized a surplus from current operations of P986.16 billion, the
difference of total revenue generated of P2.524 trillion and current operating expenses
incurred of P1.537 trillion. The said surplus was slightly increased by P10.18 billion from
sale of assets and gains but remarkably reduced by P840.57 billion, composed of negative
balance of financial assistance/subsidy of P802.51 billion, and losses of P38.06 billion,
resulting in net surplus of P155.77 billion. Table I-6 presents the financial performance of
NG for FYs 2017 and 2016.
Table I.B.1 Financial Performance of the National Government
Amount
(in million pesos)
Particulars Percent
2016 Increase/
2017
Revenue 2,523,594.14 2,229,816.10 293,778.04 13.18
Less: Current Operating Expenses 1,537,436.65 1,395,671.57 141,765.08 10.16
Surplus/(Deficit ) from Current Operations 986,157.49 834,144.54 152,012.95 18.22
Net Financial Assistance/Subsidy (802,505.15) (732,770.09) (69,735.05) 9.52
Sale of Assets 302.69 717.46 (414.78) (57.81)
Gains 9,874.79 16,019.79 (6,144.99) (38.36)
6
Amount
(in million pesos)
Particulars Percent
2016 Increase/
2017
Losses (38,064.40) (76,859.13) 38,794.73 (50.48)
Surplus/(Deficit) 155,765.42 41,252.56 114,512.86 277.59
Revenue – P2.524 trillion
Compared to P2.230 trillion for FY 2016, total revenue for FY 2017 of P2.524 trillion
increased by P293.78 billion or 13.18 percent, composed of tax revenue and non-tax
revenue of P2.257 trillion and P266.41 billion, respectively. Tax revenue of P2.257 trillion
was higher by P270.90 billion or 13.64 percent than FY 2016 of P1.986 trillion while non-
tax revenue of P266.41 billion was higher by P22.88 billion or 9.39 percent compared with
FY 2016 of P243.53 billion. The comparison of revenue collections for FYs 2017 and 2016
is presented in Chart I.B.1.
Chart I.B.1 Total Revenue

(in billion pesos)
3,000.00 266.41 243.53

10.56% 10.92%
2,500.00
2,000.00
1,500.00
2,257.18 1,986.28
1,000.00 89.44% 89.08%
500.00
-
FY 2017 FY 2016
Tax Revenue Non Tax Revenue
Current Operating Expenses – P1.538 trillion
For FY 2017, the current operating expenses of the NG amounted to P1.538 trillion, higher
by P141.77 billion or 10.16 percent than previous year amount of P1.396 trillion. The
components are: Personnel Services (PS) of P831.60 billion or 54.09 percent, Maintenance
and Other Operating Expenses (MOOE) of P302.21 billion or 19.66 percent, Financial
Expenses (FinEx) of P325.20 billion or 21.15 percent, and Non-Cash Expenses of P78.43
billion or 5.10 percent.
The increase in the total current operating expenses was a result of total increases on the
components of expenses, the highest increase of which was for PS of P69.52 billion or
9.12 percent, followed by MOOE of P55.18 billion or 22.34 percent, FinEx of P9.40 billion
or 2.98 percent, and non-cash expenses of P7.66 billion or 10.83 percent. Chart I.B.2 shows
the comparison of current operating expenses for FYs 2017 and 2016.
7
Chart I.B.2 Current Operating Expenses
(in billion pesos)
900.00
831.60
800.00 762.08
700.00
600.00
500.00
400.00
302.21 325.20 315.80
300.00
247.03
200.00
100.00 78.43 70.77
0.00
PS MOOE FinEx Non-Cash Expenses
FY 2017 FY 2016
Net Financial Assistance/Subsidy – (P802.51) billion
Financial assistance/subsidy to NGAs, LGUs, government corporations (GCs), and non-

government organizations/people’s organizations (NGOs/POs) of P805.80 billion was
more than the financial assistance/subsidy from LGUs and GCs of P3.29 billion, thereby
resulting in negative balance of net financial assistance/subsidy of P802.51 billion, the
details of which are shown in Table I.B.2.
Table I.B.2 Net Financial Assistance/Subsidy
Amount
(in million pesos)
Particulars Percent
2016 Increase/
2017
Financial Assistance/Subsidy from NGAs,
LGUs, GOCCs 3,290.50 3,285.23 5.27 0.16
Assistance from Local Government Units 3,286.12 3,252.67 33.45 1.03
Assistance from Government-Owned or
Controlled Corporations 4.38 32.56 (28.17) (86.54)
Less: Financial Assistance/Subsidy to
NGAs, LGUs, GOCCs, NGOs/POs 805,795.65 736,055.32 69,740.33 9.47
Subsidy to NGAs 203.64 10,431.52 (10,227.88) (98.05)
Financial Assistance to Local Government
Units 50,988.27 48,861.29 2,126.98 4.35
Budgetary Support to Government-Owned
or Controlled Corporations 133,700.97 135,043.59 (1,342.62) (0.99)
Financial Assistance to NGOs/POs 539.11 478.31 60.80 12.71
Internal Revenue Allotment 486,883.08 428,617.58 58,265.50 13.59
Subsidies - Others 133,480.57 112,623.04 20,857.54 18.52
Net Financial Assistance/Subsidy (802,505.15) (732,770.09) (69,735.05) 9.52
8
C. CHANGES IN NET ASSETS/EQUITY
The Statement of Changes in Net Assets/Equity (SCNA/E) reflects the elements affecting
the changes of the accumulated surplus/(deficit) at the end of the year.
From the FY 2017 negative beginning balance of P1.935 trillion, the year-end balance of
accumulated surplus/(deficit) amounted to negative P1.881 trillion. The decrease in the
accumulated deficit of P54.07 billion represents the difference of surplus for the period of
P155.77 billion and total adjustments of P101.70 billion composed of adjustment of net
revenue recognized directly in net assets/equity of negative P4.02 billion, and other
adjustments of negative P97.67 billion. Table I.C.1 shows the comparative accumulated
surplus/(deficit) for FYs 2017 and 2016.
Table I.C.1. Accumulated Surplus/(Deficit)
2016
2017
Particulars (Restated)
(in million pesos)
Balances at January 1 (1,935,204.80) (1,564,181.68)
Add/(Deduct):
Changes in accounting policy - (1,537.64)
Prior period errors - (178,451.20)
Other adjustments - (45,570.72)
Restated Balances (1,935,204.80) (1,789,741.24)
Add/(Deduct):
Changes in Net Assets/Equity for the Fiscal Year
Surplus/(Deficit) for the period 155,765.42 41,252.56
Adjustment of net revenue recognized directly in net
assets/equity (4,024.20) (12,782.81)
Others (97,672.62) (173,933.32)
Balances at December 31 (1,881,136.21) (1,935,204.80)
D. CASH FLOWS
The Statement of Cash Flows (SCF), which was prepared using the direct method, shows
the cash inflows and outflows from operating, investing and financing activities.
The cash balance of the NG as at December 31, 2017 of P865.95 billion was higher by
P306.77 billion or 54.86 percent than the FY 2016 year-end balance of P559.18 billion.
The FY 2017 ending balance differed by P628.62 billion with the total cash and cash
equivalents of P237.33 billion in the SFPos. The difference represents the negative
balances of Cash-Treasury/Agency Deposit, Special Account of P432.79 billion and Cash-
Treasury/Agency Deposit, Trust of P118.46 billion, and Sinking Fund of P77.37 billion
recognized as investment instead of cash and cash equivalents in the books of the BTr NG.
The balance of cash and cash equivalents of P794.68 billion as at January 1, 2016 varied
from the P801.39 billion as at December 31, 2015 reported in the FY 2016 AFR. The
difference of P6.71 billion resulted from the inclusion of the P1.06 billion accounts of the
Overseas Workers Welfare Administration, a former government corporation but now an
9
attached agency of the Department of Labor and Employment, and the exclusion of P7.78
billion accounts of the Commission on Elections due to non-submission of FY 2017 FSs.
For FY 2017, total cash inflows of P4.320 trillion was more than the total outflows of
P4.013 trillion or a net cash flows of P306.41 billion. The details of total cash inflows and
outflows, by activity, for FYs 2017 and 2016 are shown in Chart I.D.1.
Chart I.D.1 Cash Flows, by Activity

(in billion pesos)
4,500.00 FY 2017 FY 2016
4,000.00
3,500.00 1,502.04
1,226.67
3,000.00 1,050.02 1,340.86
181.09
2,500.00 512.93
143.38
372.68
2,000.00
1,500.00
2,636.40
2,273.53 2,345.04
1,000.00 2,060.82
500.00
-
Inflows Outflows Inflows Outflows
Operating Investing Financing
E. COMPARISON OF BUDGET AND ACTUAL AMOUNTS

The Statement of Comparison of Budget and Actual Amounts (SCBAA) presents the
original and final targets of receipts versus the actual amounts collected as well as the
original and final budgets versus the actual amounts paid.
The SCBAA presents the receipts and payments classified into budgeted amounts (original
and final) and the actual amounts on comparable basis. The final budgeted amounts are
compared with the actual amounts on comparable basis to get the difference or variance.
For FY 2017, the original and final budgeted amounts under receipts totalled P2.479
trillion and P4.011 trillion, respectively, while the actual amounts of receipts amounted to
P3.958 trillion. The variance between the final targeted and actual receipts amounting to
P53.80 billion represents the under-collections of the NG during the year.
10
The original and final budgeted amounts under payments amounted to P3.604 trillion and
P3.852 trillion, respectively, while the actual amounts of payments amounted to P2.619
trillion. The difference of P1.233 trillion between the final budget and actual payments
represents unutilized final budgeted amount, reflecting a low budget utilization rate of only
67.99 percent for FY 2017, attributed collectively to unreleased appropriations,
unobligated allotments, and unpaid obligations amounting to P66.54 billion, P325.98
billion, and P841.46 billion, respectively.
Under original budgeted amounts, payments exceeded receipts by P1.124 trillion.

Conversely, receipts exceeded payments under the final budgeted amounts by P159.21
billion. Actual receipts was higher by P1.339 trillion than actual payments.
11
II. APPROPRIATIONS,
ALLOTMENTS,
OBLIGATIONS,
DISBURSEMENTS AND
BALANCES
PART II – APPROPRIATIONS, ALLOTMENTS,
OBLIGATIONS, DISBURSEMENTS, AND BALANCES
Budget for Fiscal Year 2017

The FY 2017 budget is the first budget of the Duterte Administration and is centered along the
overarching theme of A Budget of Real Change, By the People and For the People (Paggugol
Tungo sa Tunay na Makabuluhang Pagbabago) and was designed to effect real change – a
change that will positively impact the lives of the Filipinos. To achieve this, the 2017 Budget
is anchored on the following principles: (1) fair fiscal policy, (2) credible budgets, (3) strong
focus on social order and equitable progress, (4) real fiscal transparency, and (5) governance
and budget reforms.
The FY 2017 National Budget was initially drafted by the Aquino Administration. However,
it was revised to support the following priority agenda of the Duterte Administration as defined
in the President’s first State of the Nation Address in July 2016:
 Accelerate annual infrastructure spending to 5.4 percent of Gross Domestic

Product (GDP) in 2017
The government will hike infrastructure spending to 5.4 percent of GDP in 2017 to
provide a reliable transport network by, among others, improving national roads and
bridges, including the implementation of the Mindanao Logistics Infrastructure
Network as well as inter-island linkages, to enhance access to service centers and tourist
sites;
 Maintain peace and order within the country and with our neighbors
To achieve real progress, the government will be relentless in its fight against crime
and corruption, investing on a professional police and military establishment, a working
justice system, and a lean and clean bureaucracy.
 Invest on human capital development
The government will provide more for education and health systems, to ensure equal
access to economic opportunities responsive to the human resource needs of businesses
and the private sector.
 Provide ample social protection and sustainable livelihood
The government will ensure that the poorest and the marginalized sectors of society are
protected from economic shocks and environmental disasters.
 Increase agricultural and rural enterprise productivity and rural tourism
To ensure equitable growth, the government will provide greater support to agriculture
and small, medium, and micro enterprises through the provision of infrastructure,
12
credit, research, innovation and post-harvest and common facilities in rural and
agricultural communities.
 Ensure sustained efficient macroeconomic management
The government will ensure that the sustained efficient macroeconomic management
will result in increased buying power given reduced income taxes and lower prices
accompanying lower inflation rates and adequate transport network and cheaper
business operations.
Total approved budget under Republic Act (R.A.) No. 10924, the New General Appropriations
Act (GAA) for FY 2017, amounted to P2.499 trillion composed of Programmed New
Appropriations of P2.432 trillion, comprising 97.30 percent, and Unprogrammed
Appropriations of P67.50 billion. Unprogrammed appropriations represent standby authority
to be released only when revenue collections in any one of the identified revenue sources
exceeds targets per Budget of Expenditures and Sources of Financing or when new foreign
loans or grants are received.
In comparison with the last budget (FY 2016) of the Aquino Administration of P2.139 trillion,
FY 2017 amount was higher by P360.88 billion or 16.87 percent. Compared to the last budget
of the Arroyo Administration for FY 2010 of P1.304 trillion, FY 2017 budget was higher by
P1.195 trillion or 91.62 percent. Table II-1 shows the annual budget of the National
Government (NG) from 2009 to 2017.
Table II-1 Annual Budget, Fiscal Years 2009 to 2017
Increase/
Fiscal General Appropriations
(Decrease) Percent
Year Appropriations Act
(in million pesos)
2017 R.A. No. 10924 2,499,486.95 360,882.36 16.87
2016 R.A. No. 10717 2,138,604.60 275,779.94 14.80
2015 R.A. No. 10651 1,862,824.65 254,321.57 15.81
2014 R.A. No. 10633 1,608,503.08 240,273.93 17.56
2013 R.A. No. 10352 1,368,229.16 123,035.89 9.88
2012 R.A. No. 10155 1,245,193.27 244,805.51 24.47
2011 R.A. No. 10147 1,000,387.76 (304,018.64) (23.31)
2010 R.A. No. 9970 1,304,406.40 134,087.65 11.46
2009 R.A. No. 9524 1,170,318.75
Appropriations, Allotments, Obligations, and Disbursements

for FY 2017
Appropriations are authorizations made by law or legislative enactment directing payment
out of the government funds under specified conditions or for specific purposes.
Allotments are authorizations issued by the Department of Budget and Management (DBM)
to national government agencies (NGAs) and government corporations (GCs) maintaining
Special Account in the General Fund (SAGF) to incur obligations for specified amounts
contained in legislative appropriations in the form of budget releasing documents.
13
Obligations are acts of duly authorized officials which bind the government to the immediate
or eventual payment of a sum of money. Obligations may also be referred to as commitments
that encompass possible future liabilities based on current contractual agreements.
Overdraft in allotments are obligations incurred by NGAs not covered by allotments or in

excess of allotments.
Unreleased appropriations represent the balance of the total appropriations for the year over
the total allotments released to various NGAs.
Unobligated allotments refer to the variance between total allotments, excluding allotments
to cover prior year’s overdraft, and obligations covered by allotments.
Disbursements represent the actual amounts spent or paid during a given period in currency,
thru issuance of checks/Advice to Debit Account (ADA)/Tax Remittance Advice (TRA), direct
payment abroad thru withdrawal application from the loan account, and outright deductions
from claims.
Unpaid Obligations represent the balance between total obligations and total disbursements.
For FY 2017, the NG had a total appropriations of P4.113 trillion, total allotments of P3.798
trillion, of which P1.87 million was to cover prior year’s overdraft, total obligations of P3.466
trillion, of which P864.20 million was not covered by allotment, and disbursements of P2.624
trillion thus, leaving an unreleased appropriations of P315.44 billion, unobligated allotments
of P332.55 billion, and unpaid obligations of P842.49 billion.
Compared with the previous year, a remarkable amount of increase was reported for:
appropriations – P354.35 billion or 9.43 percent, allotments – P368.68 billion or 10.75 percent,
obligations – P571.54 billion or 19.75 percent, disbursements – P204.85 billion or 8.47 percent
and unpaid obligations – P366.69 billion or 77.07 percent. The unreleased balance of
appropriations and unobligated balance of allotments both decreased by P14.33 billion or 4.34
percent and P201.10 billion or 37.68 percent, respectively. Table II-2 shows the appropriations,
allotments, obligations, disbursements and balances for FYs 2017 and 2016.
Table II-2 Comparative Appropriations, Allotments, Obligations,

Disbursements and Balances
Amount
(in million pesos)
Particulars Percent
Increase/
FY 2017 FY 2016
(Decrease)
Appropriations 4,113,286.31 3,758,934.57 354,351.73 9.43
Allotments 3,797,851.01 3,429,173.55 368,677.46 10.75
Obligations 3,466,158.89 2,894,615.00 571,543.89 19.75
Covered by Allotments 3,465,294.69 2,894,396.02 570,898.67 19.72
Overdraft in Allotments 864.20 218.98 645.22 294.65
Disbursements 2,623,665.98 2,418,814.76 204,851.22 8.47
Unreleased Appropriations 315,435.30 329,761.03 (14,325.73) (4.34)
Unobligated Allotments 332,554.45 533,655.12 (201,100.67) (37.68)
Unpaid Obligations 842,492.90 475,800.24 366,692.67 77.07
14
From FYs 2009 to 2017, the appropriations, allotments and obligations grew at an average rate
of 7.45 percent, 9.23 percent, and 8.76 percent, respectively. This trend analysis covers the
last one and a half years of President Arroyo’s Administration, the six years of President
Aquino’s Administration and the first one and a half years of President Duterte’s
Administration. Chart II-1 and Table II-3 show the trend analysis of appropriations, allotments
and obligations from FYs 2009 to 2017.
Chart II-1 Trend Analysis of Appropriations,

Allotments and Obligations
(in billion pesos)
4,113.29
4,500.00 3,758.93
4,000.00 3,077.57
3,507.80 3,797.85
2,335.48 2,408.79 2,818.39
3,500.00
2,497.48 2,529.56 3,466.16
3,000.00 3,146.83 3,429.17
2,500.00 2,729.82
2,573.71 2,894.62
2,000.00 2,379.41 2,554.02
1,976.75 2,161.40 2,228.80 2,227.53
1,500.00 1,879.46 2,196.11
1,997.29
1,000.00 1,868.48
1,764.40
500.00
0.00
2009 2010 2011 2012 2013 2014 2015 2016 2017
Appropriations Allotments Obligations
Appropriations – P4.113 trillion

For FY 2017, total appropriations of the NG amounted to P4.113 trillion composed of current
year appropriations of P3.714 trillion, and continuing appropriations of P399.23 billion.
Current year’s appropriations consists of new general appropriations (GA) of P2.499 trillion,
and automatic appropriations of P1.215 trillion, while continuing appropriations consists of
unreleased appropriations of P162.89 billion and unobligated allotments of P236.34 billion.
Table II-3 shows the comparative appropriations by source for FYs 2017 and 2016.
Table II-3 Comparative Appropriations by Source
Amount
(in million pesos)
Source Percent
Increase/
2017 2016
(Decrease)
Current Year’s Appropriations 3,714,056.54 3,381,320.06 332,736.47 9.84
New General Appropriations 2,499,486.95 2,138,604.60 360,882.36 16.87
Agency Specific Budget 1,965,345.50 1,619,842.11 345,503.39 21.33
Special Purpose Funds 534,141.45 518,762.49 15,378.97 2.96
Automatic Appropriations 1,214,569.59 1,242,715.47 (28,145.88) (2.26)
Continuing Appropriations 399,229.77 377,614.51 21,615.26 5.72
Unobligated Allotments 236,342.58 204,847.92 31,494.66 15.37
Total 4,113,286.31 3,758,934.57 354,351.73 9.43
15
By allotment class the components of FY 2017 appropriations of P4.113 trillion are the
following: Personnel Services (PS) – P993.42 billion, Maintenance and Other Operating
Expenses (MOOE) – P1.444 trillion, Financial Expenses (FinEx) – P336.96 billion, and Capital
Outlay (CO) – P1.339 trillion. Chart II-2 presents the comparative appropriations by allotment
class for FYs 2017 and 2016.
Chart II-2 Appropriations by Allotment Class

(in billion pesos)
1,600.00
1,444.18 1,338.73
1,400.00
1,264.37 1,275.98
1,200.00
993.42
1,000.00
823.94
800.00
600.00
394.64
400.00 336.96
200.00
-
PS MOOE FinEx CO
2017 2016
The amount appropriated for MOOE was higher by P179.81 billion or 14.22 percent than the
FY 2016 amount of P1.264 trillion. The increase was for the expansion of major social and
economic programs, notably the basic education program of the Department of Education
(DepEd), routine maintenance of infrastructures by the Department of Public Works and
Highways (DPWH), substantial subsidies to GCs, and financial assistance to local government
units (LGUs).
The appropriations for CO comprised 32.55 percent of the total budget. The increase of P62.74
billion or 4.92 percent was for the infrastructure requirements of the K-12 program of the
DepEd, health facilities enhancement program of the Department of Health (DOH), transport
infrastructure program of the Department of Transportation (DOTr) and road infrastructure
program of the DPWH.
PS of P993.42 billion represented 24.15 percent of the total appropriations. The increment of
P169.48 billion or 20.57 percent was primarily due to the financial requirements of the creation
of new positions and filling up of vacant items of key agencies as well as provisions for
compensation benefits including salary increase and additional allowances for
military/uniformed personnel.
Included in the appropriations for FinEx of P336.96 billion are interest expenses and bank
charges totaling P336.90 billion. Compared with the FY 2016 appropriations of P394.64
billion, a drop by P57.68 billion or 14.62 percent indicated improvement in government debt
management.
16
Table II-4 shows the appropriations by department/office and by source.
Table II-4 Appropriations by Department/Office by Source
Amount
(in billion pesos)
Continuing
Current Year Appropriations
Department/Office Appropriations
Total Agency Special Automatic Unreleased
Unobligated
Specific Purpose Appro- Appro-
Allotments
Budget Funds priations priations
Finance 1,411.85 21.50 201.03 1,141.11 42.62 5.60
Public Works and Highways 689.00 566.58 8.10 13.12 21.46 79.73
Education 501.24 434.63 3.49 26.88 2.16 34.08
National Defense 223.90 137.18 60.31 4.97 13.63 7.81
Interior and Local
Government 209.49 150.04 49.50 3.13 0.75 6.07
Social Welfare and
Development 161.57 126.78 8.07 0.42 5.39 20.91
Health 114.28 96.34 3.13 3.47 0.16 11.18
Transportation 83.48 53.35 5.73 4.08 0.19 20.13
State Universities and
Colleges 69.18 58.72 2.34 2.95 0.75 4.42
Other Executive Offices 52.73 43.40 0.91 3.93 0.96 3.54
Agriculture 51.79 39.22 0.30 1.42 4.76 6.10
Autonomous Region in
Muslim Mindanao 37.77 33.30 1.14 0.24 0.03 3.06
The Judiciary 34.78 31.85 0.32 0.92 - 1.68
Environment and Natural
Resources 31.30 26.65 0.91 0.77 0.27 2.71
Science and Technology 21.96 20.77 0.27 0.22 0.12 0.57
Justice 20.85 15.58 3.07 1.10 0.07 1.03
Foreign Affairs 20.62 16.59 0.64 0.13 0.01 3.25
Congress of the Philippines 18.27 14.98 - 0.47 - 2.83
Office of the President 16.75 15.79 0.12 0.05 - 0.80
Labor and Employment 15.18 11.44 0.71 0.31 0.16 2.56
Agrarian Reform 13.86 9.80 0.19 0.34 0.10 3.42
Commission on Elections 12.22 3.12 0.10 0.20 - 8.80
Commission on Audit 11.67 10.11 0.35 0.85 - 0.36
National Economic and
Development Authority 6.70 5.29 0.16 0.23 0.25 0.78
Information and
Communications
Technology 6.56 3.53 0.08 0.25 - 2.70
Trade and Industry 5.78 4.85 0.18 0.16 0.01 0.58
Tourism 4.02 3.28 0.04 0.03 0.33 0.34
Budget and Management 3.46 2.08 0.04 0.92 0.00 0.43
Presidential
Communications
Operations Office 3.00 2.78 0.09 0.05 0.05 0.03
Energy 2.98 1.10 0.06 1.68 - 0.14
Metropolitan Manila
Development Authority 2.63 - 2.19 0.00 - 0.43
Office of the Ombudsman 2.54 2.22 0.04 0.08 - 0.21
Civil Service Commission 1.49 1.34 0.05 0.09 - 0.01
Commission on Human
Rights 0.82 0.72 0.05 0.03 - 0.02
Office of the Vice-President 0.70 0.43 0.02 0.01 0.20 0.04
17
Amount
(in billion pesos)
Continuing
Department/Office Appropriations
Total Agency Special Automatic Unreleased
Unobligated
Specific Purpose Appro- Appro-
Allotments
Budget Funds priations priations
Joint Legislative-Executive
Councils 0.00 0.00 0.00 - - 0.00
Unreleased Special Purpose
Fund 248.89 - 180.43 - 68.46 -
Total 4,113.29 1,965.35 534.14 1,214.57 162.89 236.34
The Department of Finance (DOF) reported the highest amount of appropriations of P1.412
trillion representing 34.32 percent of the total appropriations, of which P647.28 billion or 15.74
percent was for debt service, and P486.89 billion or 11.84 percent for Internal Revenue
Allotments (IRA) of the LGUs being managed by the Bureau of the Treasury (BTr). The
DPWH and DepEd followed with P689 billion and P501.24 billion, respectively.
In comparison with the FY 2016, the appropriations of DPWH, DepEd and DOF increased by
P117.83 billion or 20.63 percent, P72.19 billion or 16.82 percent, and P46.74 billion or 3.42
percent, respectively.
Table II-5 shows the appropriations of top ten departments/offices for FYs 2017 and 2016.
Table II-5 Comparative Appropriations of Top Ten Departments/Offices
Amount
Percent (in million pesos)
Department/Office Percent
Distribution Increase/
2017 2016
(Decrease)
Finance 34.32 1,411,851.87 1,365,114.86 46,737.01 3.42
Public Works and Highways 16.75 688,995.03 571,165.24 117,829.79 20.63
Education 12.19 501,240.94 429,055.60 72,185.34 16.82
National Defense 5.44 223,896.24 195,869.03 28,027.22 14.31
Interior and Local Government 5.09 209,485.20 180,201.85 29,283.35 16.25
Social Welfare and Development 3.93 161,568.37 131,933.81 29,634.56 22.46
Health 2.78 114,275.26 94,850.26 19,425.01 20.48
Transportation 2.03 83,479.10 92,702.35 (9,223.25) (9.95)
State Universities and Colleges 1.68 69,176.55 60,242.53 8,934.02 14.83
Other Executive Offices 1.28 52,731.82 21,465.67 31,266.15 145.66
Other Departments/Offices and
Unreleased Special Purpose Fund 14.50 596,585.92 616,333.38 (19,747.46) (3.20)
Total 100.00 4,113,286.31 3,758,934.57 354,351.73 9.43
Allotments – P3.798 trillion

For FY 2017, total allotments released to the departments/offices amounted to P3.798 trillion,
representing 92.33 percent of the approved appropriations. Compared with FY 2016, PS of
P845.36 billion was higher by P73.64 billion or 9.54 percent; MOOE of P1.352 trillion was
higher by P226.75 billion or 20.15 percent; FinEx of P336.96 billion was lower by P57.68
billion or 14.62 percent; and CO of P1.263 trillion was higher by P125.96 billion or 11.08
percent. Chart II-3 presents the comparative allotments by class for FYs 2017 and 2016.
18
Chart II-3 Comparative Allotments by Class
(in billion pesos)
845.36
PS
771.72
1,352.29
MOOE
1,125.54
336.96
FinEx
394.64
1,263.23
CO
1,137.27
- 200.00 400.00 600.00 800.00 1,000.00 1,200.00 1,400.00 1,600.00
2017 2016
Of the total allotments, P3.476 trillion or 91.52 percent was sourced from current year’s
appropriations, of which P2.261 trillion or 65.06 percent was funded from the new GA and
P1.215 trillion or 34.94 percent from automatic appropriations. Included in the allotments from
current year appropriations is the allotment to cover prior year’s overdraft of P1.87 million
released to the Philippine Sports Commission.
Total allotments from unreleased continuing appropriations amounted to P85.76 billion while
prior year’s unobligated allotments forwarded as extended allotments for FY 2017 amounted
to P236.34 billion.
Compared with FY 2016, total allotments for FY 2017 of P3.798 trillion increased by P368.68
billion or 10.75 percent. Allotments released from current year’s appropriations registered net
increase of P296.73 billion or 9.33 percent, attributable to the increase in allotments from new
GA of P324.88 billion or 16.78 percent partially offset by the decrease in allotments from
automatic appropriations of P28.15 billion or 2.26 percent.
Allotments from continuing appropriations of P322.10 billion posted an increase of P71.95

billion or 28.76 percent more than the previous year of P250.16 billion. Allotments from
unreleased continuing appropriations and unobligated continuing appropriations posted
increases of P40.45 billion or 89.27 percent and P31.49 billion or 15.37 percent, respectively.
Table II-6 shows the comparative allotments by source for FYs 2017 and 2016.
Table II-6 Comparative Allotments by Source
Amount
(in million pesos)
Source Percent
Increase/
2017 2016
(Decrease)
Current Year’s Appropriations 3,475,747.98 3,179,015.55 296,732.44 9.33
19
Amount
(in million pesos)
Source Percent
Increase/
2017 2016
(Decrease)
Special Purpose Funds 353,716.04 368,655.50 (14,939.46) (4.05)
Unreleased Appropriations 85,760.45 45,310.09 40,450.36 89.27
Total 3,797,851.01 3,429,173.55 368,677.46 10.75
Of the total allotments from ASB, P1.174 trillion or 61.53 percent was for current operating
expenses (PS and MOOE), P732.06 billion or 38.38 percent for CO and P1.66 billion or 0.09
percent for FinEx.
Total allotments from Special Purpose Fund (SPF) of the new GA amounted to P353.72 billion.
Among the components of the SPF, the biggest amounts were released for Budgetary Support
to Government Corporations (BSGC) – P131.01 billion, Pension Gratuity Fund (PGF) – P91.02
billion, Allocation to Local Government Units (ALGU) – P60.73 billion, Miscellaneous
Personnel Benefits Fund (MPBF) – P25.76 billion, and Unprogrammed Appropriations/Fund
– P14.33 billion.
The breakdown of allotments from SPF is presented in Table II-7.
Table II-7 Allotments from Special Purpose Fund by Source
Amount
(in million pesos)
PY’s Continuing
Fund Appropriations
Current Year’s
Total Unreleased
Appropriations Unobligated
Appropriatio
Allotments
ns
Budgetary Support to GOCCs 149,682.74 131,012.27 18,670.47 -
Allocation to Local Government Units 74,998.42 60,727.29 13,836.65 434.47
a. Metropolitan Manila Development
Authority 2,611.55 2,178.02 - 433.53
b. Special Shares of LGUs in the
Proceeds of National Taxes
(MOOE) 32,146.20 18,756.70 13,389.51 -
c. Barangay Officials Death Benefits
Fund (MOOE) 34.17 33.23 - 0.94
d. Local Government Support Fund
(MOOE) 40,206.49 39,759.34 447.15 -
Contingent Fund 13,968.52 12,402.89 624.88 940.76
Miscellaneous Personnel Benefits Fund
(MPBF) 25,759.09 25,756.18 0.02 2.90
National Disaster Risk Reduction and
Management Fund (NDRRMF)/
Calamity Fund 53,514.60 18,463.32 28,541.23 6,510.05
Retirement Benefits Fund (Pension and
Gratuity Fund) – RBF (PGF) 91,030.49 91,022.62 - 7.88
Unprogrammed Appropriations/Fund 14,331.48 14,331.48 - -
Support for Infrastructure Projects
and Social Programs 3,887.02 3,887.02 - -
20
Amount
(in million pesos)
PY’s Continuing
Fund Appropriations
Current Year’s
Total Unreleased
Appropriations Unobligated
Appropriatio
Allotments
ns
Budgetary Support to Government-
Owned and/or Controlled
Corporations 3,181.00 3,181.00 - -
Support to Foreign-Assisted Projects 4,114.18 4,114.18 - -
General Fund Adjustments for Use of
Excess Income by Agencies 105.50 105.50 - -
General Fund Adjustments for the
Share of the ARMM pursuant to
R.A. No. 9054 (MOOE) 800.00 800.00 - -
Support for the Capability
Enhancement Program of the PNP 2,243.77 2,243.77 - -
Total 423,285.34 353,716.04 61,673.25 7,896.05
Total allotments released as budgetary support to GCs reached P166.51 billion funded from
the following SPFs: BSGC – P149.68 billion, UA/F – Support for Infrastructure Projects and
Social Programs – P3.61 billion, UA /F– BSGC – P3.18 billion and NDRRMF/Calamity Fund
– P10.04 billion. Among the GCs, the Philippine Health Insurance Corporation (PhilHealth)
received the highest subsidy of P50 billion to ensure that the poorest of the poor are covered
by a health insurance under the National Health Insurance Program. It increased by P7.66
billion or 18.10 percent over the previous year subsidy of P42.33 billion attributable to the
transfer of the appropriations for PhilHealth insurance from DOH to SPF–BSGC.
Other GOCCs that received budgetary support, equity investments and tax subsidies from NG
are shown in Table II-8.
Table II-8 Allotments for Budgetary Support to GOCCs

by Government Corporation, by Purpose
Amount
(in million pesos)
Government Corporation
Budgetary Equity Tax
Total
Support Investment Subsidy
Philippine Health Insurance Corporation 49,995.98 49,995.98 - -
National Irrigation Administration 39,976.61 39,976.61 - -
National Housing Authority 35,927.84 35,927.84 - -
National Food Authority 5,105.47 5,105.47 - -
Manila International Airport Authority 3,609.52 - - 3,609.52
Land Bank of the Philippines 3,181.00 - 3,181.00 -
National Power Corporation 2,798.25 2,798.25 - -
Philippine Economic Zone Authority 2,757.57 2,757.57 - -
National Electrification Administration 2,597.52 2,597.52 - -
Philippine Crop Insurance Corporation 2,500.00 2,500.00 - -
Local Water Utilities Administration 2,164.75 2,164.75 - -
Subic Bay Metropolitan Authority 2,149.74 2,092.56 57.19 -
National Home Mortgage Finance Corporation 1,464.11 237.41 1,226.70 -
Philippine Coconut Authority 1,423.77 1,423.77 - -
Social Housing Finance Corporation 1,103.89 1,103.89 - -
21
Amount
(in million pesos)
Government Corporation
Budgetary Equity Tax
Total
Support Investment Subsidy
Small Business Corporation 1,000.00 1,000.00 - -
Bases Conversion and Development Authority 896.13 896.13 - -
Sugar Regulatory Administration 853.41 853.41 - -
Cultural Center of the Philippines 838.16 838.16 - -
Philippine National Railways 715.00 715.00 - -
Philippine Rice Research Institute 561.00 561.00 - -
Development Academy of the Philippines 553.48 553.48 - -
Philippine Children’s Medical Center 544.16 544.16 - -
Philippine Postal Corporation 536.54 536.54 - -
Philippine Heart Center 503.92 503.92 - -
Trade and Investment Development Corporation
of the Philippines 500.00 - 500.00 -
National Kidney and Transplant Institute 464.19 464.19 - -
Lung Center of the Philippines 265.19 265.19 - -
Philippine Fisheries Development Authority 224.80 224.80 - -
Center for International Trade Expositions and
Missions 220.00 220.00 - -
National Dairy Authority 199.95 199.95 - -
Philippine Institute for Development Studies 163.54 163.54 - -
People’s Television Network, Inc. 157.30 157.30 - -
Authority of the Freeport Area of Bataan 125.00 - 125.00 -
Zamboanga City Special Economic Zone
Authority 120.00 50.00 70.00 -
Philippine Institute of Traditional and Alternative
Health Care 116.93 116.93 - -
Philippine Center for Economic Development 44.75 44.75 - -
Southern Philippines Development Authority 41.06 41.06 - -
Aurora Pacific Economic Zone and Freeport
Authority 40.00 40.00 - -
Light Rail Transit Authority 37.55 37.55 - -
Tourism Infrastructure and Enterprise Zone
Authority 20.00 20.00 - -
Credit Information Corporation 12.80 12.80 - -
Total 166,510.84 157,741.47 5,159.89 3,609.52
Total allotments from automatic appropriations amounted to P1.215 trillion of which, P1.134
trillion or 93.38 percent were for debt service and IRA amounting to P647.28 billion and
P486.89 billion, respectively. Allotments for debt service consists of P312.40 billion for
payment of principals and P334.88 billion for interest expenses.
For FY 2017, total allotments from continuing appropriations amounted to P322.10 billion,
posting an increase of P71.95 billion or 28.76 percent over previous year of P250.16 billion.
Of the total, P236.34 billion or 73.37 percent was from the forwarded unobligated allotments
of previous year, of which P228.43 billion or 96.65 percent was from the ASB, P7.90 billion
or 3.34 percent from the SPF, and P14.35 million or 0.01 percent from automatic
appropriations. Allotments from the unreleased continuing appropriations summed at P85.76
billion, sourced from the following: ASB - P24.09 billion and SPF - P61.67 billion.
Among the departments, the biggest allotments from ASB were released to DPWH and DepED
at P560.04 billion and P405.61 billion, respectively. On the other hand, the highest amount of
22
allotments from SPF and automatic appropriations was received by the DOF at P201.03 billion
and P1.141 trillion, respectively due to the administration by the BTr of the BSGC, ALGU,
IRA for LGUs, and debt service.
Table II-9 shows the allotments of the departments/offices, by source.
Table II-9 Allotments by Department/Office and by Source
Amount
(in billion pesos)
Current Year Appropriations Continuing Appropriations
Department/Office
Agency Special Automatic Unreleased
Total Unobligated
Specific Purpose Appropria- Appropria-
Allotments
Budget Funds tions tions
Finance 1,411.32 21.02 201.03 1,141.11 42.57 5.60
Public Works and Highways 674.93 560.04 8.10 13.12 13.94 79.73
Education 472.10 405.61 3.49 26.88 2.03 34.08
Interior and Local Government 202.35 143.2 49.50 3.13 0.45 6.07
Social Welfare and Development 161.57 126.78 8.07 0.42 5.39 20.91
Health 112.25 94.31 3.13 3.47 0.16 11.18
Transportation 82.35 52.31 5.73 4.08 0.09 20.13
State Universities and Colleges 65.58 55.23 2.34 2.95 0.65 4.42
Agriculture 51.75 39.18 0.30 1.42 4.76 6.10
Autonomous Region in Muslim
Mindanao 36.91 32.45 1.14 0.24 0.03 3.06
The Judiciary 34.31 31.39 0.32 0.92 - 1.68
Resources 31.25 26.60 0.91 0.77 0.27 2.71
Justice 20.69 15.49 3.07 1.10 0.01 1.03
Foreign Affairs 20.61 16.59 0.64 0.13 - 3.25
Agrarian Reform 13.61 9.65 0.19 0.34 0.00 3.42
Information and
Communications Technology 6.55 3.52 0.08 0.25 - 2.70
Tourism 4.01 3.27 0.04 0.03 0.33 0.34
Budget and Management 3.44 2.06 0.04 0.92 0.00 0.43
Energy 2.98 1.09 0.06 1.68 - 0.14
Presidential Communications
Metropolitan Manila
Development Authority 2.63 - 2.19 0.00 - 0.43
Commission on Human Rights 0.81 0.71 0.05 0.03 - 0.02
Councils 0.00 0.00 0.00 - - 0.00
Total 3,797.85 1,907.46 353.72 1,214.57 85.76 236.34
Compared with the FY 2016, the FY 2017 allotments of DPWH and DepEd increased by
P125.40 billion or 22.82 percent and P55.68 billion or 13.37 percent, respectively. This is in
23
support for the DPWH commitments to complete the pavement of all national arterial and
secondary roads, inclusive of the remaining unpaved national roads as well as road network
development (e.g., construction of missing gaps, by-passes, diversion roads, etc.) asset
preservation, and various works for access roads leading to airports, ports and tourism
destinations, among others, and for DepEd’s K-12 program.
Table II-10 shows the comparative allotments of top ten departments/offices for FYs 2017 and
2016.
Table II-10 Comparative Allotments of Top Ten Departments/Offices
Amount
Percent
(in million pesos)
Department/Office Distri- Percent
Increase/
bution 2017 2016
(Decrease)
Finance 37.16 1,411,318.56 1,364,449.97 46,868.59 3.43
Education 12.43 472,096.46 416,420.74 55,675.72 13.37
Health 2.96 112,246.14 90,704.79 21,541.35 23.75
Transportation 2.17 82,345.84 92,299.25 (9,953.42) (10.78)
Other Departments/Offices 9.07 344,593.44 345,211.41 (617.97) (0.18)
Total 100.00 3,797,851.01 3,429,173.55 368,677.46 10.75
Appropriations and Allotments for Foreign-Assisted Projects

Appropriations – P49.14 billion
For FY 2017, total current year appropriations for foreign-assisted projects amounted to P49.14
billion, of which P38.06 billion or 77.44 percent was appropriated under the ASB of the
implementing departments/agencies concerned and P11.08 billion or 22.56 percent was from
the following SPF: UA/F-Support to Foreign-Assisted Projects (SFAPs) – P7.91 billion and
BSGC – P3.17 billion. Of the total appropriations, P40.89 billion was funded from loan
proceeds while the balance of P8.25 billion was the government counterpart provided by the
NG.
Among the departments/offices, the highest amount was appropriated for the DOTr in the
amount of P14.33 billion, of which P10.21 billion was funded from the ASB while P4.11 billion
was from UA/F-SFAPs. The DSWD and DPWH followed with P10.23 billion and P9.97
billion, respectively.
Table II-11 shows the appropriations for foreign-assisted projects, by department/office and by
allotment class.
24
Table II-11 Appropriations for Foreign-Assisted Projects,
by Department/Office, by Allotment Class
Amount
(in million pesos)
Maintenance
Department/Office
Personnel and Other Financial Capital
Total
Services Operating Expenses Outlay
Expenses
Current Year Appropriations 8.10 18,587.67 0.03 30,547.12 49,142.92
Agency Specific Budget 8.10 14,271.02 0.03 23,778.91 38,058.07
Social Welfare and
Development - 10,229.16 - - 10,229.16
Transportation - - - 10,214.37 10,214.37
Public Works and Highways - - - 9,974.21 9,974.21
Agriculture - 2,813.35 0.03 445.64 3,259.02
Agrarian Reform 6.64 682.86 - 1,494.70 2,184.20
Resources - 507.28 - 1,528.39 2,035.67
Finance - - - 121.60 121.60
State Universities and Colleges 1.47 25.37 - - 26.84
Interior and Local Government - 13.00 - - 13.00
Special Purpose Funds - 4,316.64 - 6,768.22 11,084.86
Unprogrammed
Appropriations/Fund - SFAPs - 1,146.51 - 6,768.22 7,914.73
Transportation - - - 4,114.18 4,114.18
Unreleased/Unallocated 1,146.51 2,654.04 3,800.55
Budgetary Support to GOCCs - 3,170.13 - - 3,170.13
Finance-BTr (budgetary
support to National
Irrigation Administration) - 3,170.13 - - 3,170.13
Total 8.10 18,587.67 0.03 30,547.12 49,142.92
Allotments – P43.61 billion
Of the amount appropriated, P43.61 billion or 88.75 percent was released to the implementing
departments/agencies broken down by allotment class as follows: PS – P8.10 million, MOOE
– P17.41 billion, FinEx – P0.03 million and CO – P26.20 billion.
Among the departments/offices, the highest allotments were released to the DOTr in the
amount of P13.30 billion, of which P9.19 billion was funded from the ASB while P4.11 billion
was from UF-SFAPs. The DSWD and DPWH followed with P10.23 billion and P9.31 billion,
respectively.
Table II-12 shows the allotments for foreign-assisted projects, by department/office and by
allotment class.
25
Table II-12 Allotments for Foreign-Assisted Projects,
by Department/Office, by Allotment Class
Amount
(in million pesos)
Maintenance
Department/Office
Personnel and Other Financial Capital
Total
Services Operating Expenses Outlay
Expenses
Agency Specific Budget 8.10 14,237.48 0.03 22,084.39 36,330.00
Social Welfare and Development - 10,229.16 - - 10,229.16
Public Works and Highways - - - 9,307.90 9,307.90
Transportation - - - 9,186.17 9,186.17
Agriculture - 2,813.35 0.03 445.64 3,259.02
Agrarian Reform 6.64 649.32 - 1,494.70 2,150.65
Resources - 507.28 - 1,528.39 2,035.67
Finance - - - 121.60 121.60
State Universities and Colleges 1.47 25.37 - - 26.84
Interior and Local Government - 13.00 - - 13.00
Special Purpose Funds - 3,170.13 - 4,114.18 7,284.31
Unprogrammed Fund/
Appropriations - SFAPs - - - 4,114.18 4,114.18
Transportation - - - 4,114.18 4,114.18
Budgetary Support to GOCCs - 3,170.13 - - 3,170.13
Finance-BTr (budgetary
support to National
Irrigation Administration) - 3,170.13 - - 3,170.13
Total 8.10 17,407.60 0.03 26,198.57 43,614.31
The Statements of Appropriations, Allotments and Balances (SAAB) for FAPs are presented
in Part VI, Volume II of this Report.
Unreleased Appropriations – P315.44 billion

The unreleased balance of appropriations for FY 2017 of P315.44 billion represents the
difference between the total appropriations of P4.113 trillion and the total allotments of P3.798
trillion. Table II-13 shows the appropriations, allotments and unreleased appropriations of the
departments/offices for FY 2017.
Table II-13 Appropriations, Allotments and Unreleased Appropriations
Amount
(in million pesos)
Particulars
Unreleased
Appropriations Allotments
Appropriations
Education 501,240.94 472,096.46 29,144.48
Public Works and Highways 688,995.03 674,932.88 14,062.14
Interior and Local Government 209,485.20 202,349.11 7,136.09
National Defense 223,896.24 218,374.23 5,522.01
State Universities and Colleges 69,176.55 65,581.81 3,594.74
Health 114,275.26 112,246.14 2,029.13
26
Amount
(in million pesos)
Particulars
Unreleased
Appropriations Allotments
Appropriations
Transportation 83,479.10 82,345.84 1,133.26
Autonomous Region in Muslim Mindanao 37,767.19 36,913.93 853.26
Finance 1,411,851.87 1,411,318.56 533.31
Congress of the Philippines 18,270.02 17,780.90 489.12
Judiciary 34,775.51 34,314.67 460.84
Other Executive Offices 52,731.82 52,445.53 286.29
Agrarian Reform 13,858.21 13,610.83 247.39
Labor and Employment 15,176.09 14,993.35 182.73
Commission on Audit 11,669.35 11,512.67 156.68
Justice 20,849.94 20,694.83 155.12
Presidential Communications Operations
Office 2,996.22 2,843.63 152.59
Science and Technology 21,956.79 21,808.89 147.89
National Economic and Development
Authority 6,704.24 6,625.19 79.05
Agriculture 51,793.35 51,745.99 47.36
Environment and Natural Resources 31,299.29 31,254.05 45.24
Budget and Management 3,460.97 3,442.86 18.12
Commission on Human Rights 821.73 806.92 14.81
Foreign Affairs 20,623.94 20,610.10 13.84
Information and Communications
Technology 6,559.93 6,546.19 13.74
Trade And Industry 5,780.95 5,770.21 10.75
Tourism 4,017.41 4,009.63 7.78
Energy 2,981.58 2,975.33 6.25
Civil Service Commission 1,493.26 1,489.75 3.51
Social Welfare and Development 161,568.37 161,567.00 1.37
Office of the Ombudsman 2,542.51 2,541.63 0.87
Office of the President 16,747.16 16,747.13 0.03
Commission on Elections 12,222.78 12,222.78 -
Office of the Vice-President 696.23 696.23 -
Joint Legislative-Executive Councils 3.81 3.81 -
Metropolitan Manila Development
Authority 2,631.93 2,631.93 -
Unreleased Special Purpose Funds 248,885.54 - 248,885.54
Total 4,113,286.31 3,797,851.01 315,435.30
Chart II-4 shows the unreleased Chart II-4 Unreleased Appropriations

appropriations for FYs 2017 and by Allotment Class
2016, by allotment class. (in billion pesos)
148.05 138.83 138.71
Compared to the previous year 150.00
balance of P329.76 billion, FY 91.89
2017 unreleased appropriations 100.00 75.49
decreased by P14.33 billion or 4.34 52.22
percent. The increase in the 50.00
unreleased balance of current year
appropriations of P36 billion was -
offset by the total decrease of PS MOOE CO
P50.33 billion in the unreleased
FY 2017 FY 2016
balance of continuing
appropriations.
27
Table II-14 presents the comparative unreleased appropriations by source for FYs 2017 and
2016.
Table II-14 Comparative Unreleased Appropriations by Source
Amount
(in million pesos)
Source Percent
Increase/
2017 2016
(Decrease)
Current Year Appropriations 238,308.55 202,304.52 36,004.04 17.80
Agency Specific Budget 57,883.14 52,197.53 5,685.60 10.89
Special Purpose Funds 180,425.42 150,106.98 30,318.43 20.20
Continuing Appropriations 77,126.75 127,456.51 (50,329.76) (39.49)
Agency Specific Budget 8,666.62 11,233.31 (2,566.69) (22.85)
Total 315,435.30 329,761.03 (14,325.73) (4.34)
The details of the unreleased appropriations from current year and continuing appropriations
by SPF are shown in Table II-15.
Table II-15 Unreleased Appropriations from Special

Purpose Funds
Amount
(in million pesos)
Current Year
Particulars Continuing
Appropriations
Appropriations Total
R. A. No.
R. A. No. 10717
10924
Budgetary Support to GOCCs 6,198.91 2,641.63 8,840.55
Maintenance and Other Operating Expenses 5,520.47 2,641.63 8,162.11
Capital Outlays 678.44 - 678.44
Allocation to Local Government Units 12,429.31 18,265.48 30,694.79
a. Special Shares of LGUs in the Proceeds of
National Taxes 12,212.54 18,027.60 30,240.14
Share in the Utilization and Development of
National Wealth under R.A. No. 7160 and
R.A. No. 9513 2,539.81 2,414.98 4,954.79
Share in the Gross Income Taxes paid by all
Businesses and Enterprises within the
ECOZONES pursuant to R.A. No. 7922 56.53 20.30 76.83
Share in Value Added Tax pursuant to R.A.
No. 7643 9,151.14 15,557.89 24,709.04
Share in Value added Tax in Lieu of
Franchise Tax pursuant to R.A. No. 7953
and R.A. No. 8407 1.59 1.73 3.31
Prior Years' Obligations 422.48 1 422.48
Share in the 2% Special Privilege Tax
pursuant to RA 7156 41.00 32.69 73.69
b. Barangay Officials Death Benefits Fund 16.77 12.28 29.05
c. Local Government Support Fund - 25.60 25.60
d. Special Shares of LGUs in the Proceeds of Fire
Code Fees 200.00 200.00 400.00
Contingent Fund 3,097.11 189.00 3,286.11
Capital Outlays 3,097.11 189.00 3,286.11
28
Amount
(in million pesos)
Current Year
Particulars Continuing
Appropriations
Appropriations Total
R. A. No.
R. A. No. 10717
10924
Miscellaneous Personnel Benefits Fund 63,345.43 199.98 63,545.41
Personnel Services 63,145.46 - 63,145.46
Maintenance and Other Operating Expenses 199.96 199.98 399.94
National Disaster Risk Reduction and Management
Fund 1,290.68 5,054.00 6,344.68
Maintenance and Other Operating Expenses (573.05) - (573.05)
Capital Outlays 1,863.74 5,053.99 6,917.73
Pension and Gratuity Fund 40,895.45 1,274.13 42,169.58
Personnel Services 40,299.72 - 40,299.72
Maintenance and Other Operating Expenses 595.73 1,274.13 1,869.86
Unprogrammed Appropriations/Fund 53,168.52 40,835.91 94,004.43
Capital Outlays 17,145.64 27,874.97 45,020.61
Support for Infrastructure Projects and Social
Programs 8,063.97 2,701.16 10,765.14
Capital Outlays 6,222.50 456.62 6,679.12
AFP Modernization Program 5,000.00 10,000.00 15,000.00
Maintenance and Other Operating Expenses - 500.00 500.00
Capital Outlays 5,000.00 9,500.00 14,500.00
Budgetary Support to Government-Owned
and/or Controlled Corporations 819.00 - 819.00
Capital Outlays 819.00 - 819.00
Support to Foreign-Assisted Projects 3,800.55 270.38 4,070.93
Maintenance and Other Operating Expenses 1,146.51 84.55 1,231.06
Capital Outlays 2,654.04 185.82 2,839.86
Risk Management Program 29,000.00 24,500.00 53,500.00
Capital Outlays - 14,500.00 14,500.00
General Fund Adjustments for Use of Excess
Income by Agencies 94.50 129.44 223.93
Maintenance and Other Operating Expenses 89.50 96.92 186.41
Capital Outlays 5.00 32.52 37.52
General Fund Adjustments for the Share of the
ARMM pursuant to R. A. No. 9054 - 34.93 34.93
Maintenance and Other Operating Expenses - 34.93 34.93
Support for the Capability Enhancement
Program of the PNP 3,390.50 - 3,390.50
Maintenance and Other Operating Expenses 945.40 - 945.40
Capital Outlays 2,445.10 - 2,445.10
Provision of Scholarships to Faculty Members
and HEI Administrators 1,000.00 - 1,000.00
Maintenance and Other Operating Expenses 1,000.00 - 1,000.00
Provision for Payment of Arrears of LTO-IT
Service 2,000.00 - 2,000.00
Maintenance and Other Operating Expenses 2,000.00 - 2,000.00
Land Bank of the Philippines - Loan Portfolio
(Priority and Other Priority Areas) - 3,200.00 3,200.00
Capital Outlays - 3,200.00 3,200.00
Total 180,425.42 68,460.12 248,885.54
29
The unreleased appropriations of SPF totaled P248.89 billion. Of the total, P94 billion or 37.77
percent pertained to UA/F, of which P53.50 billion was for Risk Management Program, P15
billion for AFP Modernization Program, and P10.77 billion for Support for Infrastructure
Projects and Social Programs. Table II-16 shows the unreleased balances of appropriations of
the departments/offices for FYs 2017 and 2016.
Table II-16 Comparative Unreleased Appropriations of Top Ten Departments/Offices
Amount
Percent
Department/ (in million pesos)
Distri- Percent
Office Increase/
bution 2017 2016
(Decrease)
Education 9.24 29,144.48 12,634.86 16,509.62 130.67
Public Works and Highways 4.46 14,062.14 21,629.84 (7,567.69) (34.99)
National Defense 1.75 5,522.01 14,533.43 (9,011.42) (62.00)
Health 0.64 2,029.13 4,145.47 (2,116.34) (51.05)
Transportation 0.36 1,133.26 403.09 730.17 181.14
Autonomous Region in Muslim Mindanao 0.27 853.26 838.37 14.89 1.78
Finance 0.17 533.31 664.89 (131.58) (19.79)
Congress of the Philippines 0.16 489.12 691.24 (202.13) (29.24)
Other Departments/Offices and Unreleased
Special Purpose Funds 79.55 250,937.76 270,185.56 (19,247.80) (7.12)
Total 100.00 315,435.30 329,761.03 (14,325.73) (4.34)
Of the unreleased appropriations of P315.44 billion for FY 2017, the amount of P310.60 billion
or 98.47 percent was reverted, composed of the following: PS – P148.05 billion, MOOE –
P91.89 billion, and CO – P70.66 billion. Of the amount reverted, P233.47 billion was from
current year appropriations while P77.13 billion was from continuing appropriations. The
unreleased balance of CO of P4.83 billion was retained as continuing appropriations,
representing the unreleased balance of the Revised AFP Modernization Program of the AFP
General Headquarters.
Table II-17 shows the unreleased appropriations by source, by department/office.
Table II-17 Unreleased Appropriations by Source,

by Department/Office
Amount
(in million pesos)
Continuing
Department/Office Current Year Appropriations Appro-
Total priations
For For For
Total
Reversion Retention Reversion
Education 29,144.48 29,017.48 29,017.48 - 127.00
Public Works and Highways 14,062.14 6,544.15 6,544.15 - 7,518.00
Interior and Local Government 7,136.09 6,838.49 6,838.49 - 297.60
National Defense 5,522.01 5,316.51 481.63 4,834.88 205.50
State Universities and Colleges 3,594.74 3,488.19 3,488.19 - 106.55
Health 2,029.13 2,029.13 2,029.13 - -
Transportation 1,133.26 1,033.72 1,033.72 - 99.54
Mindanao 853.26 853.26 853.26 - -
30
Amount
(in million pesos)
Continuing
Department/Office Current Year Appropriations Appro-
Total priations
For For For
Total
Reversion Retention Reversion
Finance 533.31 483.31 483.31 - 50.00
Congress of the Philippines 489.12 489.12 489.12 - -
The Judiciary 460.84 460.84 460.84 - -
Other Executive Offices 286.29 233.79 233.79 - 52.50
Agrarian Reform 247.39 147.39 147.39 - 100.00
Labor and Employment 182.73 182.73 182.73 - -
Commission on Audit 156.68 156.68 156.68 - -
Justice 155.12 90.74 90.74 - 64.38
Operations Office 152.59 152.59 152.59 - -
Science and Technology 147.89 147.89 147.89 - -
Development Authority 79.05 50.73 50.73 - 28.32
Agriculture 47.36 43.96 43.96 - 3.40
Resources 45.24 45.24 45.24 - -
Budget and Management 18.12 18.12 18.12 - -
Commission on Human Rights 14.81 14.81 14.81 - -
Foreign Affairs 13.84 - - - 13.84
Information and
Communications Technology 13.74 13.74 13.74 - -
Trade and Industry 10.75 10.75 10.75 - -
Tourism 7.78 7.78 7.78 - -
Energy 6.25 6.25 6.25 - -
Civil Service Commission 3.51 3.51 3.51 - -
Social Welfare and
Development 1.37 1.37 1.37 - -
Office of the Ombudsman 0.87 0.87 0.87 - -
Office of the President 0.03 0.03 0.03 - -
Office of the Vice-President - - - - -
Councils - - - - -
Commission on Elections - - - - -
Metropolitan Manila
Development Authority - - - - -
Special Purpose Fund
Unreleased Appropriations 248,885.54 180,425.42 180,425.42 - 68,460.12
Total 315,435.30 238,308.55 233,473.67 4,834.88 77,126.75
Obligations – P3.466 trillion

For FY 2017, total obligations incurred by NGAs amounted to P3.466 trillion, representing
91.27 percent of the total allotments of P3.798 trillion. Of the total obligations, P3.465 trillion
or 99.98 percent was covered by allotments while P864.20 million was not covered by
allotments. Chart II-5 shows the comparative obligations by allotment class for FYs 2017 and
2016.
31
Chart II-5 Comparative Obligations, by Allotment Class
(in billion pesos)
1,400.00 1,294.69
1,200.00
1,013.74 1,026.64
1,000.00
832.61 823.12
800.00 753.67
600.00
400.00 312.22 304.09

200.00
-
PS MOOE FE CO
2017 2016
Of the total obligations, P3.194 trillion or 92.15 percent was charged to current year
appropriations and P272.02 billion or 7.85 percent was charged to continuing appropriations.
Compared to obligations of P2.894 trillion incurred in the previous year, FY 2017 total
obligations increased by P571.54 billion or 19.75 percent. Table II-18 shows the obligations,
by source for FYs 2017 and 2016.
Table II-18 Comparative Obligations, by Source
Amount
(in million pesos)
Source Percent
Increase/
2017 2016
(Decrease)
Current Year Appropriations 3,194,141.83 2,711,275.91 482,865.93 17.81
Unreleased Appropriations 81,188.48 37,695.71 43,492.78 115.38
Total 3,466,158.89 2,894,615.00 571,543.89 19.75
The highest obligations were incurred by DOF, DPWH, and DepEd in the amounts of P1.223
trillion, P621.64 billion, and P458.41 billion, respectively. Table II-19 presents the obligations
by source, by department/office.
32
Table II-19 Obligations by Source, by Department/Office
Amount
(in billion pesos)
Continuing
Department/Office Total Appropriations
Agency Special Automatic Unreleased
Unobligated
Specific Purpose Appro- Appropria
Allotments
Budget Funds priations -tions
Finance 1,222.50 18.07 201.00 956.97 42.57 3.89
Public Works And Highways 621.64 527.28 7.37 11.74 10.78 64.47
Education 458.41 397.77 3.41 26.80 1.59 28.84
Interior and Local Government 200.93 142.54 49.39 3.10 0.45 5.43
Social Welfare and Development 153.62 121.98 7.04 0.38 4.79 19.43
Health 106.72 89.77 2.98 3.36 0.15 10.46
Transportation 69.24 46.08 5.71 3.83 0.08 13.54
State Universities and Colleges 63.39 53.73 2.25 2.87 0.58 3.97
Agriculture 48.88 37.15 0.29 1.23 4.55 5.67
Mindanao 35.19 30.91 1.14 0.24 0.03 2.87
The Judiciary 32.92 30.85 0.32 0.86 - 0.89
Resources 30.16 25.62 0.91 0.76 0.26 2.62
Justice 19.03 14.61 2.66 1.06 0.01 0.70
Foreign Affairs 18.93 15.81 0.63 0.13 - 2.36
Agrarian Reform 10.57 8.43 0.19 0.32 0 1.63
Technology 6.18 3.36 0.07 0.11 - 2.64
Tourism 3.70 3.03 0.03 0.03 0.33 0.27
Budget and Management 3.07 1.74 0.04 0.92 0. 0.38
Metropolitan Manila
Development Authority 2.34 - 2.04 0 - 0.29
Energy 2.22 0.94 0.06 1.17 - 0.05
Commission on Human Rights 0.81 0.71 0.05 0.03 - 0.02
Councils 0 0 0 - - 0
Total 3,466.16 1,818.67 349.27 1,026.20 81.19 190.83
Overdraft in Allotments – P864.20 million

Of the total obligations of P3.466 trillion, P864.20 million or 0.02 percent was not covered by
allotments, broken down as follows: PS – P44.32 million, MOOE – P686.34 million and CO –
33
P133.54 million. Of the overdraft in allotments, P178.08 million was charged to current year
appropriations while P686.12 million was charged to continuing appropriations.
The total overdraft in allotments in PS of P44.32 million included P28.92 million obligated and
paid by Philippine Drug Enforcement Agency and P1.80 million by Environmental
Management Bureau. These overdrafts were charged by both agencies to their respective
unreleased appropriations categorized as For Later Release (FLR) which they recorded as
allotments without the requisite Special Allotment Release Order (SARO). The total overdraft
in PS also included P9.54 million obligated and paid by the Bureau of Internal Revenue (BIR)
for retirement and life insurance premiums which were charged to BIR’s ASB. The overdraft
of P7.95 million was disbursed by the National Police Commission (NAPOLCOM) without
the corresponding allotments and obligations.
Of the overdraft in MOOE of P686.34 million, P686.08 million or 99.96 percent was incurred
by the House of Representatives (HOR). Without the requisite SARO, the HOR recorded as
released allotments the appropriations for PS under Administration of Personnel Benefits of
P686.08 million categorized as “FLR”. HOR retained the allotment as continuing
appropriations of FY 2016 and obligated the same in FY 2017.
Of the overdraft of P133.54 million in CO, P133.50 million or 99.97 percent was incurred by
the DPWH-OSEC for the procurement of closed circuit television cameras of the MMDA
pursuant to Road Board Resolution Nos. 17-06 and 17-11. The allotment released was for
MOOE but was recorded as CO without the approved realignment from DBM. The NGAs
which incurred overdraft for FY 2017 are shown in Table II-20
Table II-20 Departments/Agencies with Overdraft
Amount
Department/Agency (in thousand pesos)
Total PS MOOE CO
Congress of the Philippines 686,078.00 - 686,078.00 -
House of Representatives 686,078.00 - 686,078.00 -
Environment and Natural Resources 3,870.02 3,832.42 - 37.60
Office of the Secretary 37.60 - - 37.60
Environmental Management Bureau 3,832.42 3,832.42 - -
Finance 9,541.54 9,541.54 - -
Bureau of Internal Revenue 9,541.54 9,541.54 - -
Public Works and Highways 133,500 - - 133,500
Office of the Secretary 133,500 - - 133,500
Science and Technology 556.00 556.00 - -
Philippine Council for Health Research and
Development 556.00 556.00 - -
Other Executive Offices 30,650.48 30,387.26 263.22 -
Housing and Urban Development
Coordinating Council 102.66 102.66 - -
National Commission on Muslim Filipinos 303.34 40.12 263.22 -
Philippine Drug Enforcement Agency 30,244.48 30,244.48 - -
Total 864,196.04 44,317.22 686,341.22 133,537.60
34
Among the departments/offices, the DOF, DPWH and DepEd, reported the highest obligations
of P1.150 trillion, P425.84 billion, and P371.05 billion, respectively. The obligations incurred
by the DOF increased by P540.00 billion due to the transfer of the administration of the funds
for the LGUs from the DBM to the BTr and the increase in payments for debt service.
Table II-21 shows the comparative obligations of top ten departments/offices for FYs 2017 and
2016.
Table II-21 Comparative Obligations of Top Ten Departments/Offices
Increase/
Department/ Percent 2017 2016
(Decrease) Percent
Office Distribution
(in million pesos)
Finance 35.27 1,222,498.91 1,150,549.04 71,949.87 6.25
Education 13.23 458,407.12 371,048.70 87,358.42 23.54
Health 3.08 106,720.28 78,679.87 28,040.41 35.64
Transportation 2.00 69,244.46 61,797.45 7,447.01 12.05
Agriculture 1.41 48,879.57 45,579.39 3,300.18 7.24
Other Departments/Offices 8.87 307,531.04 260,351.79 47,179.25 18.12
Total 100.00 3,466,158.89 2,894,615. 571,543.89 19.75
Unobligated Allotments – P332.55 billion

The unobligated allotments amounting to P332.55 billion represents the difference between
total allotments of P3.798 trillion, excluding allotment to cover previous year’s overdraft of
P1.87 million, and obligations covered by allotments of P3.465 trillion.
Table II-22 presents the allotments, obligations and unobligated allotments, by

department/office for FY 2017.
Table II-22 Allotments, Obligations and Unobligated Allotments,

Amount
(in million pesos)
Particulars Obligations
Unobligated
Allotments Covered by
Allotments
Allotments
Finance 1,411,318.56 1,222,489.37 188,829.19
Education 472,096.46 458,407.12 13,689.34
Transportation 82,345.84 69,244.46 13,101.38
Social Welfare and Development 161,567.00 153,622.88 7,944.13
Commission on Elections 12,222.78 5,648.59 6,574.19
Health 112,246.14 106,720.28 5,525.86
Office of the President 16,747.13 11,617.03 5,130.10
Other Executive Offices 52,443.66 47,376.87 5,066.79
Congress of the Philippines 17,780.90 13,683.75 4,097.15
35
Amount
(in million pesos)
Particulars Obligations
Unobligated
Allotments Covered by
Allotments
Allotments
Agrarian Reform 13,610.83 10,573.50 3,037.32
Agriculture 51,745.99 48,879.57 2,866.42
Labor and Employment 14,993.35 12,883.06 2,110.29
Autonomous Region in Muslim Mindanao 36,913.93 35,186.62 1,727.31
Foreign Affairs 20,610.10 18,929.35 1,680.75
Justice 20,694.83 19,032.58 1,662.25
Judiciary 34,314.67 32,922.21 1,392.46
Science and Technology 21,808.89 20,619.10 1,189.79
Environment and Natural Resources 31,254.05 30,155.97 1,098.07
Energy 2,975.33 2,218.75 756.58
Authority 6,625.19 6,055.27 569.92
Information and Communications Technology 6,546.19 6,180.00 366.18
Tourism 4,009.63 3,702.19 307.44
Metropolitan Manila Development Authority 2,631.93 2,335.64 296.28
Trade And Industry 5,770.21 5,495.99 274.21
Presidential Communications Operations Office 2,843.63 2,684.06 159.57
Office of the Vice-President 696.23 663.43 32.80
Joint Legislative-Executive Councils 3.81 3.70 0.11
Commission on Human Rights 806.92 806.92 -
Total 3,797,849.14 3,465,294.69 332,554.45
Allotments to Cover Prior Year Overdraft 1.87 - -
Total 3,797,851.01 3,465,294.69 332,554.45
Chart II-6 shows the comparative unobligated allotments, by class for FYs 2017 and 2016.
Chart II-6 Comparative Unobligated Allotments, by Class

(in billion pesos)
350.00 313.26
300.00 236.73
250.00
200.00
111.78
150.00 90.56
100.00 58.29
18.07 24.74
50.00 12.79
-
PS MOOE FinEx CO
FY 2017 FY 2016
36
Compared with FY 2016 unobligated allotments of P533.66 billion, FY 2017 unobligated
balance decreased by P201.10 billion or 37.68 percent, as a result of the decrease in the
unobligated allotments from current year’s appropriations of P186.18 billion or 39.78 percent
and from continuing appropriations of P14.92 billion or 22.72 percent. Table II-23 shows the
comparative unobligated allotments by source for FYs 2017 and 2016.
Table II-23 Comparative Unobligated Allotments, by Source
Amount
(in million pesos)
Source Percent
Increase/
2017 2016
(Decrease)
Current Year’s Appropriations 281,782.36 467,958.62 (186,176.26) (39.78)
New General Appropriations 93,269.12 258,026.04 (164,756.92) (63.85)
Agency Specific Budget 88,825.97 244,293.26 (155,467.29) (63.64)
Automatic Appropriations 188,513.24 209,932.58 (21,419.34) (10.20)
Continuing Appropriations 50,772.09 65,696.50 (14,924.42) (22.72)
Allotted Appropriations 46,200.12 59,204.53 (13,004.41) (21.97)
Total 332,554.45 533,655.12 (201,100.67) (37.68)
Of the unobligated balance of P332.55 billion, P13.54 billion was retained as continuing
appropriations while P319.01 billion was reverted to the unappropriated surplus of the general
fund. Of the total retained unobligated allotments, P6.41 billion was from current year
appropriations, while P7.13 billion was from prior years’ continuing appropriations. The
breakdown of retained unobligated allotments, by class are: PS – P4.79 billion, MOOE – P6.05
billion, and CO – P2.71 billion. Total unobligated balance of allotments reverted in FY 2017
of P319.01 billion comprised of PS – P8.01 billion, MOOE – P52.25 billion, FinEx – P24.74
billion and CO – P234.02 billion. The Schedule of Continuing Appropriations is presented in
Part IX, Volume II of this Report.
Table II-24 shows the comparative unobligated allotments of top ten departments/offices for
FYs 2017 and 2016.
Table II-24 Comparative Unobligated Allotments of
Top Ten Departments/Offices
Amount
Department/ Percent (in million pesos)
Percent
Office Distribution Increase/
2017 2016
(Decrease)
Finance 56.78 188,829.19 212,888.41 (24,059.22) (11.30)
Public Works and Highways 16.07 53,426.92 123,694.33 (70,267.41) (56.81)
Education 4.12 13,689.34 45,373.39 (31,684.04) (69.83)
Transportation 3.94 13,101.38 30,503.45 (17,402.07) (57.05)
Social Welfare and
Development 2.39 7,944.13 23,041.08 (15,096.96) (65.52)
Commission on Elections 1.98 6,574.19 8,803.65 (2,229.45) (25.32)
Health 1.66 5,525.86 12,024.92 (6,499.06) (54.05)
Office of the President 1.54 5,130.10 3,639.97 1,490.13 40.94
National Defense 1.53 5,078.20 12,668.38 (7,590.18) (59.91)
Other Departments/Offices 8.48 28,188.35 57,598.20 (29,409.85) (51.06)
Total 100.00 332,554.45 533,655.12 (201,100.67) (37.68)
37
The Statements of Appropriations, Allotments, Obligations, and Balances for FY 2017 are
presented in Part VI, Volume II of this Report.
Disbursements – P2.624 trillion

For FY 2017, total disbursements by the NG amounted to P2.624 trillion, representing 75.69
percent of the total obligations of P3.466 trillion. Chart II-7 shows the comparative
disbursements by allotment class for FYs 2017 and 2016.
Chart II-7 Comparative Disbursements by Allotment Class

(in billion pesos)
1,200.00
1,043.55
1,000.00 887.62
814.26
800.00 729.17
600.00 498.49
454.20
400.00 311.66 303.54
200.00
-
PS MOOE FinEx CO
FY 2017 FY 2016
For FY 2017, huge amounts of decrease in disbursements were reported by DBM – P11.78
billion, DOTr – P10.89 billion and DOLE – P4.89 billion. The decline in disbursements of the
DBM was due primarily to the transfer of the administration of the IRA and financial subsidy
to LGUs to the BTr while the decline in disbursements of DOLE was due to the transfer of
Technical Education and Skills Development Authority as attached agency to Other Executive
Offices.
Table II-25 presents the comparative disbursements of department/offices for FYs 2017 and
2016.
Table II-25 Comparative Disbursements by Department/Office
Amount
(in million pesos)
Particulars Percent
Increase/
2017 2016
(Decrease)
Finance 1,113,965.92 1,097,282.60 16,683.32 1.52
Education 384,435.61 340,715.32 43,720.29 12.83
Public Works and Highways 226,263.16 186,042.16 40,221.00 21.62
Interior and Local Government 183,928.36 163,845.92 20,082.44 12.26
38
Amount
(in million pesos)
Particulars Percent
Increase/
2017 2016
(Decrease)
National Defense 172,267.09 154,991.44 17,275.65 11.15
Social Welfare and Development 129,805.34 92,644.35 37,160.99 40.11
Health 67,023.61 56,117.66 10,905.95 19.43
State Universities and Colleges 53,542.97 46,205.03 7,337.94 15.88
Agriculture 32,474.48 25,330.50 7,143.97 28.20
Judiciary 32,088.27 30,405.29 1,682.98 5.54
Transportation 27,122.26 38,011.03 (10,888.77) (28.65)
Other Executive Offices 23,842.19 13,065.71 10,776.48 82.48
Autonomous Region in Muslim Mindanao 23,140.82 21,827.57 1,313.24 6.02
Environment and Natural Resources 22,211.51 21,368.73 842.78 3.94
Justice 17,386.08 14,002.42 3,383.66 24.16
Foreign Affairs 17,190.57 15,530.84 1,659.73 10.69
Science and Technology 14,246.96 14,255.05 (8.10) (0.06)
Congress of the Philippines 13,069.29 11,517.85 1,551.44 13.47
Commission on Audit 10,978.13 9,598.18 1,379.95 14.38
Labor and Employment 10,404.19 15,293.62 (4,889.42) (31.97)
Office of the President 8,572.34 2,511.63 6,060.72 241.31
Agrarian Reform 8,273.69 7,362.04 911.65 12.38
Trade And Industry 4,741.85 4,363.33 378.52 8.68
Commission on Elections 4,618.18 5,823.27 (1,205.09) (20.69)
Authority 4,532.16 5,794.55 (1,262.39) (21.79)
Budget and Management 2,760.17 14,535.60 (11,775.43) (81.01)
Office 2,602.37 1,176.78 1,425.58 121.14
Tourism 2,408.74 2,725.86 (317.12) (11.63)
Technology 2,406.17 - 2,406.17 -
Office of the Ombudsman 2,289.72 2,117.76 171.96 8.12
Civil Service Commission 1,477.82 1,449.40 28.42 1.96
Authority 1,277.99 1,399.01 (121.02) (8.65)
Energy 998.48 787.25 211.23 26.83
Commission on Human Rights 700.58 449.20 251.38 55.96
Office of the Vice-President 615.23 265.17 350.06 132.01
Joint Legislative-Executive Councils 3.68 2.64 1.04 39.35
Total 2,623,665.98 2,418,814.76 204,851.22 8.47
Unpaid Obligations – P842.49 billion

For FY 2017, total unpaid obligations of the NG amounted to P842.49 billion or 24.31 percent
of the total obligations of P3.466 trillion. Chart II-8 reflects the comparative unpaid obligations
by allotment class for FYs 2017 and 2016.
39
Chart II-8 Comparative Unpaid Obligations by Allotment Class
(in billion pesos)
600.00 572.44
500.00
400.00 324.63
300.00 251.13
200.00 126.13
18.35 24.50 0.54
100.00 0.57
-
FY 2017 FY 2016
PS MOOE FinEx CO
Among the departments/offices, the highest amounts of unpaid obligations were reported by
the following: DPWH – P395.38 billion or 46.93 percent, DOF – P108.53 billion or 12.88
percent, DepEd – P73.97 billion or 8.78 percent, DOTr – P42.12 billion or 5 percent, DND –
P41.03 billion or 4.87 percent, and DOH – P39.70 billion or 4.71 percent. Table II-26 presents
the obligations, disbursements and unpaid obligations by department/office.
Table II-26 Comparative Obligations, Disbursements and Unpaid Obligations,

Amount
(in million pesos)
Particulars
Unpaid
Obligations Disbursements
Obligations
Finance 1,222,498.91 1,113,965.92 108,532.99
Education 458,407.12 384,435.61 73,971.51
Transportation 69,244.46 27,122.26 42,122.20
Health 106,720.28 67,023.61 39,696.67
Social Welfare and Development 153,622.88 129,805.34 23,817.54
Other Executive Offices 47,407.52 23,842.19 23,565.33
Agriculture 48,879.57 32,474.48 16,405.10
Mindanao 35,186.62 23,140.82 12,045.81
Environment and Natural Resources 30,159.84 22,211.51 7,948.33
Science and Technology 20,619.66 14,246.96 6,372.70
Technology 6,180.00 2,406.17 3,773.83
Office of the President 11,617.03 8,572.34 3,044.69
Labor and Employment 12,883.06 10,404.19 2,478.87
Agrarian Reform 10,573.50 8,273.69 2,299.82
Foreign Affairs 18,929.35 17,190.57 1,738.78
Justice 19,032.58 17,386.08 1,646.50
40
Amount
(in million pesos)
Particulars
Unpaid
Obligations Disbursements
Obligations
Authority 6,055.27 4,532.16 1,523.10
Congress of the Philippines 14,369.82 13,069.29 1,300.53
Tourism 3,702.19 2,408.74 1,293.45
Energy 2,218.75 998.48 1,220.27
Authority 2,335.64 1,277.99 1,057.66
Commission on Elections 5,648.59 4,618.18 1,030.41
The Judiciary 32,922.21 32,088.27 833.94
Trade and Industry 5,495.99 4,741.85 754.14
Commission on Human Rights 806.92 700.58 106.35
Office 2,684.06 2,602.37 81.69
Office of the Vice-President 663.43 615.23 48.20
Joint Legislative-Executive Councils 3.70 3.68 0.01
Total 3,466,158.89 2,623,665.98 842,492.90
In comparison with FY 2016, a significant drop in balances of unpaid obligations for FY 2017
were reported by: COMELEC – P6.19 billion, DA – P3.84 billion, DFA – P1.82 billion, DOT
– P608.83 million, DOJ – P452.60 million, and COP – P331.98 million. Table II-27 presents
the comparative unpaid obligations by department/office for FYs 2017 and 2016.
Table II-27 Comparative Unpaid Obligations by Department/Office
Amount
(in million pesos)
Particulars Percent
Increase/
2017 2016
(Decrease)
Public Works and Highways 395,376.30 239,799.53 155,576.77 64.88
Finance 108,532.99 53,266.44 55,266.55 103.75
Education 73,971.51 30,333.38 43,638.13 143.86
Transportation 42,122.20 23,786.41 18,335.78 77.09
National Defense 41,028.94 13,676.24 27,352.70 200.00
Health 39,696.67 22,562.20 17,134.46 75.94
Social Welfare and Development 23,817.54 16,248.37 7,569.17 46.58
Other Executive Offices 23,565.33 4,390.89 19,174.44 436.69
Interior and Local Government 16,997.15 6,712.32 10,284.82 153.22
Agriculture 16,405.10 20,248.89 (3,843.79) (18.98)
Autonomous Region in Muslim Mindanao 12,045.81 5,555.90 6,489.91 116.81
State Universities and Colleges 9,850.65 6,443.39 3,407.26 52.88
Environment and Natural Resources 7,948.33 4,306.77 3,641.56 84.55
Science and Technology 6,372.70 4,684.30 1,688.41 36.04
Information and Communications Technology 3,773.83 - 3,773.83 -
Office of the President 3,044.69 314.31 2,730.38 868.69
Labor and Employment 2,478.87 1,573.94 904.93 57.49
Agrarian Reform 2,299.82 830.35 1,469.46 176.97
Foreign Affairs 1,738.78 3,554.25 (1,815.48) (51.08)
Justice 1,646.50 2,099.09 (452,60) (21.56)
41
Amount
(in million pesos)
Particulars Percent
Increase/
2017 2016
(Decrease)
Authority 1,523.10 740.44 782.66 105.70
Congress of the Philippines 1,300.53 1,632.51 (331.98) (20.34)
Tourism 1,293.45 1,902.28 (608.83) (32.01)
Energy 1,220.27 1,010.78 209.49 20.73
Metropolitan Manila Development Authority 1,057.66 206.26 851.40 412.78
Commission on Elections 1,030.41 7,224.78 (6,194.36) (85.74)
The Judiciary 833.94 960.79 (126.85) (13.20)
Trade and Industry 754.14 1,001.45 (247.31) (24.70)
Budget and Management 312.92 432.11 (119.19) (27.58)
Office of the Ombudsman 113.11 152.84 (39.73) (26.00)
Commission on Human Rights 106.35 35.53 70.82 199.35
Commission on Audit 101.85 61.50 40.35 65.60
Presidential Communications Operations Office 81.69 28.24 53.46 189.30
Office of the Vice-President 48.20 13.65 34.55 253.20
Civil Service Commission 1.56 9.93 (8.37) (84.26)
Joint Legislative-Executive Council 0.01 0.16 (0.15) (91.22)
Total 842,492.90 475,800.24 366,692.67 77.07
The Statement of Appropriations, Allotments, Obligations, Disbursements and Balances for

FY 2017, by department/office and by agency is presented in Part VII, Volume II of this Report.
42
III. CURRENT SURPLUS
OF THE NATIONAL
GOVERNMENT
PART III – CURRENT SURPLUS OF THE NATIONAL
GOVERNMENT
Legal Framework
Section 2 (1), Article IX-D of the 1987 Philippine Constitution mandates the Commission
on Audit to “keep the general accounts of the Government x x x.”
This is an exceptional set-up, where the COA is mandated by the Constitution itself to
perform a limited accounting function, because, ordinarily, an Audit Office does not carry
out accounting functions. This is otherwise known as the limited accounting function of
COA. In charge of the actual performance of this constitutionally-mandated duty is the
Government Accountancy Sector (GAS) of the Commission.
The phrase “general accounts” mentioned in the Charter provision, is construed to refer to
the books of the Unappropriated Surplus of the General Fund (GF) of the National
Government (NG) now being maintained by the GAS thru the following registries
prescribed under COA Resolution No. 2014-022 dated September 12, 2014:
Registry Particulars
Registry of Revenue (RR)  revenues generated by the NG agencies
(NGAs) that accrue to the GF, including grants
based on the verified Quarterly Report on
Revenue and Other Receipts
Registry of Domestic and Foreign  domestic and foreign loans of the NG based on
Borrowings (RDFB) the verified Quarterly Report of Domestic and
Foreign Borrowings from the NGAs and
Bureau of the Treasury (BTr)
Registry of Appropriations and  appropriations of the agency based on the
Allotments (RAPAL) General Appropriations Act (GAA) and other
appropriations laws
 allotments releases by the Department of
Budget and Management (DBM) to the various
agencies of the government out of the
authorized appropriations
 appropriations and release of allotments
pertaining to Special Purpose Fund (SPF)
 transfer from one agency to another,
realignment/augmentation, and withdrawal of
appropriations and allotments based on the
Special Allotment Release Orders (SAROs),
budget documents/letter authority received
from the DBM
 unreleased appropriations
Registry of Appropriations and  appropriations for the SPF based on the GAA
Transfers for Special Purpose Funds  transfer of appropriations for SPF to the
(RATSPF) departments/agencies concerned based on the
SAROs/budget documents issued by the DBM
43
Registry Particulars
Registry of Allotments, Obligations  obligations incurred and paid by the agencies
and Disbursements (RAOD) out of the released allotments based on the
verified Budget and Financial Accountability
Reports (BFARs)
 unobligated balances of allotments
 unpaid obligations (due and demandable and
not yet due and demandable)
Registry of Overdraft in Allotments  obligations incurred by the agencies but not
(ROA) covered by allotments based on verified
BFARs
The amounts of appropriations and allotments in the RAPAL and RATSPF are reconciled
periodically with the data of the DBM and with the NGAs quarterly BFARs prescribed in
COA-DBM Joint Circular No. 2013-1 dated March 13, 2013, and as modified under COA-
DBM Joint Circular No. 2014-1 dated July 2, 2014.
At the end of the year, based on the Registries, the GAS prepares the overall Statement of
Appropriations, Allotments, Obligations, Disbursements and Balances (SAAODB) and
the Statement of Current Surplus (SCS), which form part of the Annual Report on
Appropriations, Allotments, Obligations and Disbursements (ARAAOD) and the Annual
Financial Report (AFR) for the NG.
The ARAAOD is for submission to the President of the Philippines and the Congress not
later than April 30 after the end of every fiscal year pursuant to R.A. No. 7226 dated March
12, 1992 and the Special Provisions on COA in the GAA. On the other hand, the AFR is
for submission to the President of the Philippines and the Congress not later than
September 30 of the ensuing year.
Current Surplus of the National Government

The Current Surplus of the NG is the net balance of the combined figures of the following
components: Unappropriated Surplus, Unreleased Continuing Appropriations,
Unobligated Continuing Appropriations, and Overdraft in Allotments.
For FY 2017, the overall ending balance of the Current Surplus amounted to P939.10
billion, broken down as follows: Unappropriated Surplus – P922.05 billion, Unreleased
Continuing Appropriations – P4.83 billion, Unobligated Continuing Appropriations –
P13.54 billion, and Overdraft in Allotments – P1.32 billion.
Table III.1 Current Surplus of the National Government

(in million pesos)
Unreleased Unobligated Overdraft

Total Current Unappropriated
Description Continuing Continuing in
Surplus Surplus
Appropriations Appropriations Allotments
Beginning Balance 447,628.94 49,331.47 150,088.16 248,670.37 (461.06)
Adjustments - (473.11) 12,799.03 (12,327.79) 1.87
Adjusted Beginning
Balance 447,628.94 48,858.36 162,887.20 236,342.58 (459.19)
44
Unreleased Unobligated Overdraft
Total Current Unappropriated
Description Continuing Continuing in
Surplus Surplus
Appropriations Appropriations Allotments
Add:
Revenue 2,455,602.85 2,455,602.85 - - -
Borrowings 1,502,030.57 1,502,030.57 - - -
Issuance of Bills 713,901.42 713,901.42 - - -
Issuance of Bonds 727,939.84 727,939.84 - - -
Loan Proceeds 60,189.32 60,189.32 - - -
Sub-total 4,405,262.36 4,006,491.78 162,887.20 236,342.58 (459.19)
Obligations (3,466,158.89) (3,193,963.75) (81,188.48) (190,142.45) (864.20)
Sub-total 939,103.47 812,528.03 81,698.71 46,200.12 (1,323.39)
Reversion of
Continuing
Appropriations - 120,772.93 (81,698.71) (39,074.22) -
Sub-total 939,103.47 933,300.96 - 7,125.90 (1,323.39)
Retention of
Continuing
Appropriations - (11,248.70) 4,834.88 6,413.82 -
Ending Balances 939,103.47 922,052.26 4,834.88 13,539.72 (1,323.39)
Unappropriated Surplus – P922.05 billion
The Unappropriated Surplus is composed of various transactions that transpired during the
year, such as: revenue, borrowings, obligations, adjustments, reversions and retentions of
unreleased continuing appropriations and unobligated continuing appropriations.
From its beginning balance of P49.33 billion, it ended to P922.05 billion brought about by
the following transactions: adjustments – (P473.11) million, revenue – P2.456 trillion,
borrowings – P1.502 trillion, obligations covered by allotments from current year’s
appropriations – P3.194 trillion, reversions of unreleased continuing appropriations and
unobligated continuing appropriations of P120.77 billion, and retentions of unreleased
continuing appropriations and unobligated continuing appropriations of P11.25 billion.
Unreleased Continuing Appropriations – P4.83 billion
The unreleased continuing appropriations refers to the unreleased balance of the total
appropriations for which no comprehensive release and allotment release orders were
issued by the DBM.
From its beginning balance of P150.09 billion, the year-end balance registered at P4.83
billion brought about by the following: adjustments in the beginning balance – P12.80
billion, obligations – P81.19 billion, reversions – P81.70 billion, and retentions – P4.83
billion. The breakdown of retained unreleased continuing appropriations by
department/office and by agency is shown in Part VI, Volume II of this Report.
Unobligated Continuing Appropriations – P13.54 billion
This component of the Current Surplus pertains to the released portion of appropriations
which remained unexpended or unobligated at the end of the year.
45
From its beginning balance of P248.67 billion, the year-end balance amounted to P13.54
billion brought about by the following: adjustments in the beginning balance – (P12.33)
billion, obligations – P190.14 billion, reversions – P39.07 billion, and retentions – P6.41
billion. The breakdown of unobligated continuing appropriations by department/office
and by agency is presented in Part VI, Volume II of this Report.
Overdraft in Allotments – P1.32 billion
Obligations incurred in excess of allotments is another kind of transactions affecting the

Current Surplus. Total overdraft in allotments of P1.32 billion consists of the obligations
not covered by allotments incurred by NGAs in FY 2012 - P81.59 million, FY 2013 –
P3.26 million, FY 2014 – P148.53 million, FY 2015 – P8.71 million, FY 2016 – P217.11
million and FY 2017 – P864.20 million. The breakdown of overdraft in allotments
incurred by department/office and by agency is shown in Part VI, Volume II of this Report.
46
IV. COMPARATIVE FINANCIAL
STATEMENTS
Republic of the Philippines
National Government
Statement of Financial Position
As at December 31, 2017
(in thousand pesos)
2016
Note 2017 (Restated)
ASSETS
Current Assets
Cash and Cash Equivalent 4 237,331,695.16 37,726,754.18
Investments 5 94,465,127.56 75,765,942.05
Receivables 6 854,917,537.24 787,841,068.82
Inventories 7 90,091,458.27 65,853,106.09
Other Current Assets 8 150,852,722.58 126,383,381.83
Total Current Assets 1,427,658,540.81 1,093,570,252.96
Non-Current Assets
Investments 9 995,205,694.18 1,106,420,918.46
Receivables 10 203,481,165.74 200,276,491.50
Investment Property 11 2,159,375.50 2,699,787.05
Property, Plant and Equipment 12 2,496,282,517.73 2,176,209,166.05
Biological Assets 13 1,478,263.10 1,942,525.33
Intangible Assets 14 4,533,729.21 2,877,871.23
Other Non-Current Assets 15 116,449,869.04 112,848,720.33
Total Non-Current Assets 3,819,590,614.51 3,603,275,479.95
TOTAL ASSETS 5,247,249,155.32 4,696,845,732.91
LIABILITIES
Current Liabilities
Financial Liabilities 16 987,220,728.95 882,225,362.04
Inter-Agency Payables 17 63,459,598.79 61,802,233.79
Intra-Agency Payables 18 131,882.06 -
Trust Liabilities 19 66,122,086.88 52,606,038.52
Other Payables 20 44,928,638.71 85,081,070.97
Deferred Credits/Unearned Income 21 4,918,195.92 5,458,984.93
Provisions 22 61,163.34 47,380.26
Total Current Liabilities 1,166,842,294.65 1,087,221,070.52
Non-Current Liabilities
Financial Liabilities 23 5,863,483,592.88 5,389,492,343.60
Trust Liabilities 24 15,647,417.44 11,411,904.90
Deferred Credits/Unearned Income 25 27,578,554.34 26,315,419.93
Other Payables 26 29,660,416.52 24,007,632.12
Provisions 27 1,997,839.95 2,913,906.13
Total Non-Current Liabilities 5,938,367,821.13 5,454,141,206.68
TOTAL LIABILITIES 7,105,210,115.78 6,541,362,277.19
NET ASSETS (1,857,960,960.46) (1,844,516,544.29)
NET ASSETS/EQUITY
Government Equity (1,858,884,136.18) (1,859,166,682.92)
Accumulated Surplus/(Deficit) 42 (1,881,136,207.98) (1,935,204,804.90)
Contributed Capital 8,000.00 8,000.00
Revaluation Surplus 22,244,071.80 76,030,121.97
Unrealized Gain/(Loss) 923,175.71 14,650,138.64
NET ASSETS/EQUITY (1,857,960,960.46) (1,844,516,544.29)
Difference between totals and sum of components is due to rounding off

The above statement should be read in conjunction with the accompanying notes.
47
National Government
Detailed Statement of Financial Performance
For the Year Ended December 31, 2017
(in thousand pesos)
2016
Revenue
Tax Revenue 29 2,257,181,512.89 1,986,281,846.52
Service and Business Income 30 197,872,237.50 187,226,778.62
Shares, Grants and Donations 31 67,579,754.45 55,486,622.50
Miscellaneous Income 32 883,871.21 773,833.62
Gains 33 76,762.69 47,021.17
Total Revenue 2,523,594,138.74 2,229,816,102.44

Less: Current Operating Expenses
Personnel Services 34 831,596,893.62 762,078,451.54
Maintenance and Other Operating Expenses 35 302,208,768.34 247,028,807.80
Financial Expenses 36 325,201,289.14 315,797,365.97
Non-Cash Expenses 37 78,429,699.50 70,766,941.85
Total Current Operating Expenses 1,537,436,650.59 1,395,671,567.16
Surplus/(Deficit) from Current Operations 986,157,488.15 834,144,535.28
Net Financial Assistance/Subsidy 38 (802,505,148.53) (732,770,094.47)

Other Non-Operating Income 39 10,177,479.63 16,737,248.98
Losses 40 (38,064,397.32) (76,859,130.69)
Surplus/(Deficit) for the period 41 155,765,421.93 41,252,559.10

48
National Government
Statement of Changes in Net Assets/Equity
(in thousand pesos)
Accumulated
Surplus/(Deficit)
2016
Balances at January 1 42.1 (1,935,204,804.90) (1,564,181,676.04)

Add/(Deduct):
Changes in accounting policy - (1,537,638.81)
Prior period errors - (178,451,198.79)
Other Adjustments - (45,570,722.88)
Restated Balances (1,935,204,804.90) (1,789,741,236.51)
Add/(Deduct):
Changes in Net Assets/Equity for the Fiscal Year 42.2
Surplus/(Deficit) for the Period 155,765,421.93 41,252,559.10
Adjustment of net revenue recognized directly in net assets/equity (4,024,202.05) (12,782,810.11)
Others (97,672,622.96) (173,933,317.37)
Balances at December 31 42.3 (1,881,136,207.98) (1,935,204,804.90)

49
National Government
Statement of Cash Flows
(in thousand pesos)
2016
Cash Flows From Operating Activities
Cash Inflows 43
Collection of Income/Revenues 2,467,137,318.96 2,190,303,713.97
Receipt of Assistance and Subsidy and from
Other NGAs, LGUs and GOCCs 5,069,803.25 4,398,210.12
Collection of Receivables 52,328,652.62 41,566,084.32
Receipt of Inter-Agency Fund Transfers 22,283,150.52 19,690,739.26
Trust Receipts 70,601,648.78 55,720,607.57
Other Receipts 14,115,277.56 28,964,882.33
Adjustments 4,867,969.83 4,394,386.43
Total Cash Inflows 2,636,403,821.52 2,345,038,624.01
Cash Outflows 44
Payment of Expenses 742,730,020.78 699,073,429.77
Purchase of Inventories 43,418,790.03 31,752,507.19
Purchase of Consumable Biological Assets 167,636.65 1,987,687.47
Grant of Cash Advances 74,666,795.64 64,476,586.68
Prepayments 9,083,878.69 5,904,493.67
Refund of Deposits 31,174,818.32 41,613,455.93
Payment of Accounts Payable 82,209,942.76 57,938,603.94
Remittance of Personnel Benefit Contributions and
Mandatory Deductions 258,483,994.87 267,856,904.28
Grant of Financial Assistance/Subsidy 773,392,383.34 630,014,029.60
Release of Inter-Agency Fund Transfers 100,939,335.30 85,973,558.10
Other Disbursements 109,114,350.59 47,368,375.71
Adjustments 48,150,543.60 126,858,095.19
Total Cash Outflows 2,273,532,490.56 2,060,817,727.52
Net Cash Provided by (Used in) Operating Activities 362,871,330.97 284,220,896.50
Cash Flows from Investing Activities
Cash Inflows 45
Proceeds from Sale of Investment Property 11,151.52 22,218.74
Proceeds from Sale/Disposal of Property, Plant and Equipment 25,481.09 23,766.36
Sale of Investments 68,843,649.31 47,661,293.76
Receipt of Cash Dividends 30,440,502.26 28,900,821.54
Proceeds from Matured/Return of Investments 77,038,623.66 63,871,192.56
Collection of Long-Term Loans 4,727,651.28 2,900,273.36
Proceeds from Sale of Other Assets 5,167.66 4,231.19
Total Cash Inflows 181,092,226.79 143,383,797.50
Cash Outflows 46
Purchase/Construction of Investment Property 191,320.43 26,070.49
Purchase/Construction of Property, Plant and Equipment 392,593,408.27 324,400,980.77
Investments 115,783,207.00 44,363,360.85
Purchase of Bearer Biological Assets 24,563.12 22,067.88
Purchase of Intangible Assets 423,871.01 530,067.38
Grant of loans 3,909,720.31 3,332,461.70
Total Cash Outflows 512,926,090.14 372,675,009.06
Net Cash Provided by (Used in) Investing Activities (331,833,863.35) (229,291,211.57)
Cash Flows from Financing Activities
Cash Inflows 47
Proceeds from issuance of bills and bonds 1,441,842,233.81 1,001,423,131.69
Proceeds from Domestic and Foreign Loans 60,199,924.04 48,597,541.61
Total Cash Inflows 1,502,042,157.84 1,050,020,673.30
Cash Outflows 48
Payment of Long-Term Liabilities 64,766,166.13 68,883,868.15
Redemption of Bills/Bonds Issued 890,128,917.56 1,002,049,095.86
Payment of Interest Expense 271,777,888.84 269,924,677.69
Total Cash Outflows 1,226,672,972.53 1,340,857,641.70
Net Cash Provided by (Used in) Financing Activities 275,369,185.32 (290,836,968.40)
Increase(Decrease) in Cash and Cash Equivalents 306,406,652.94 (235,907,283.47)
Effects of Exchange Rate Changes on Cash and Cash Equivalents 49 363,198.37 414,337.71
Cash and Cash Equivalents, January 1, 50.1 559,183,327.01 794,676,272.76
Cash and Cash Equivalents, December 31 50.2 865,953,178.32 559,183,327.01

50
National Government
Statement of Comparison of Budget and Actual Amounts
(in thousand pesos)
Budgeted Amount Actual Amounts on Differrence Final

Note Original Final Comparable Basis Budget and Actual
RECEIPTS 51
Tax Revenue 2,313,470,975.00 2,321,385,274.76 2,264,578,047.22 56,807,227.54
Service and Business Income 145,021,928.00 126,116,292.89 133,136,548.72 (7,020,255.83)
Shares, Grants and Donations 19,447,233.00 57,846,494.05 54,838,252.41 3,008,241.64
Gains 22,647.00 2,502,405.44 2,511,883.49 (9,478.05)
Others 1,468,309.00 1,503,541,584.48 1,502,526,800.45 1,014,784.03
Non-Operating Income/Revenues 1,468,309.00 1,511,012.25 496,228.22 1,014,784.03
Loan Proceeds (Foreign Loans) - 60,189,317.19 60,189,317.19 -
Issuance of Bills (Domestic) - 713,901,417.87 713,901,417.87 -
Issuance of Bonds - 727,939,837.17 727,939,837.17 -
Domestic - 702,002,513.54 702,002,513.54 -
Foreign - 24,242,257.00 24,242,257.00 -
Interest - 1,695,066.63 1,695,066.63 -
Total Receipts 2,479,431,092.00 4,011,392,051.62 3,957,591,532.29 53,800,519.33
PAYMENTS 52
Personnel Services 765,275,418.14 882,630,668.47 811,113,046.40 71,517,622.07
Maintenance and Other Operating Expenses 1,112,886,647.11 1,350,721,161.22 1,042,083,209.21 308,637,952.01
Capital Outlays 1,074,926,306.08 969,448,255.85 301,198,843.15 668,249,412.70
Financial Expenses 337,357,042.80 336,961,159.35 311,655,887.19 25,305,272.16
Debt Service (Principal Amortization) 313,259,829.72 312,403,000.00 152,996,820.04 159,406,179.96
Total Payments 3,603,705,243.84 3,852,164,244.90 2,619,047,805.99 1,233,116,438.91
NET RECEIPTS/PAYMENTS 53 (1,124,274,151.84) 159,227,806.72 1,338,543,726.30 (1,179,315,919.58)

51
National Government
Notes to Combined Financial Statements
1. GENERAL INFORMATION
The 2017 AFR for the National Government (NG) presents the combined Financial
Statements (FSs) submitted by 321 national government agencies (NGAs),
including the state universities and colleges (SUCs), Autonomous Region in
Muslim Mindanao (ARMM) and government corporations (GCs) maintaining
Special Account in the General Fund (SAGF). Of these entities, 254 operate as
stand-alone, while 67 have staff bureaus, regional offices (ROs), and operating
units (OUs)/field offices (FOs), of which 19 adopt a centralized accounting system
and 48 a decentralized accounting system. The list of these entities and their
registered office addresses are shown in Annex A.
2. STATEMENT OF COMPLIANCE AND BASIS OF

PREPARATION OF FINANCIAL STATEMENTS
As stated in the Statement of Management Responsibilities for FSs signed by the

heads of the agencies, the FSs were prepared in conformity with the Philippine
Public Sector Accounting Standards (PPSAS) prescribed under Commission on
Audit (COA) Resolution No. 2014-003 dated January 24, 2014 and with generally
accepted state accounting principles. To a great extent, the NGAs complied with
the provisions of the Government Accounting Manual (GAM) issued under COA
Circular No. 2015-007 dated October 22, 2015.
The FSs comprise the Statement of Financial Position (SFPos), Statement of

Financial Performance (SFPer), Statement of Changes in Net Assets/Equity
(SCNA/E), Statement of Cash Flows (SCF), Statement of Comparison of Budget
and Actual Amounts (SCBAA), and the Notes to FSs. These statements were
prepared on the basis of historical cost, unless stated otherwise.
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
3.1. Basis of accounting
The combined FSs are prepared on an accrual basis in accordance with

applicable PPSAS except in the case of taxes and related fines and penalties
which are recognized when collected or when these are measurable and
legally collectible.
3.2. Combination/Consolidation
The combined FSs cover the FSs submitted by fund cluster, as follows:
a. Regular Agency Fund
52
b. Foreign Assisted Projects Fund
c. Special Account-Locally Funded/Domestic Grants Fund
d. Special Account-Foreign Assisted/Foreign Grants Fund
e. Internally Generated Funds
f. Business Related Funds
g. Trust Funds
Intra-governmental transactions are eliminated in the consolidation, except

for unmatched transactions and balances discussed in the succeeding pages
of this Report.
3.3. Presentation of financial statements
This Report presents on a comparative basis the FSs for FY 2017 and
restated FSs for FY 2016. This is to facilitate analysis of changes/variances
of the current year from that of the previous year.
3.4. Correction of prior years’ errors
Prior years’ errors affecting the assets and liabilities are corrected using the
related accounts, while those affecting the income and expense accounts
are adjusted to the Accumulated Surplus/(Deficit) account.
3.5. Changes in accounting estimates and policies
The NGAs apply the prospective application in recognizing the effects of

changes in accounting estimates; as such, the changes are included in the
surplus or deficit. On the other hand, the retrospective application is used
to effect changes in accounting policy, except when application is
impractical, wherein the prospective application is used.
3.6. Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and cash in banks, which
are composed of current and savings accounts, and time deposits, in
Philippine peso and foreign currencies. Cash equivalents are short-term and
highly liquid investments with original maturity of three months or less
from date of acquisition, which are readily convertible to known amounts
of cash and subject to insignificant risk of changes in value.
Petty Cash Fund (PCF) is set up for the recurring petty expenses of an
agency for one month. It is maintained on an imprest system wherein
replenishment is charged to the appropriate expense accounts. The PCF is
kept separately from the other cash advances, and is not used for payment
of regular expenses such as rentals, inventory items for stock and other
disbursements which should be paid through checks and/or Advice to Debit
Account (ADA).
53
3.7. Financial assets
a. Initial recognition
Financial assets are recognized by an NGA when it becomes party to

the contractual provisions of the instrument. A financial asset is
measured initially at its fair value plus, in the case of financial asset not
measured at fair value through surplus or deficit, transaction costs that
are directly attributable to the acquisition or issue of the financial asset.
Financial assets within the scope of PPSAS 29-Financial Instruments:

Recognition and Measurement, are classified as: (1) financial assets at
fair value through surplus or deficit, (2) held-to-maturity investments,
and (3) loans and receivables or available-for-sale financial assets, as
appropriate. The classification of financial assets at initial recognition
depends on the purpose for which the financial assets are bought and
held. Management decides on their initial classification at the time of
initial recognition.
b. Subsequent measurement
The subsequent measurement of financial assets depends on their

classification. After initial recognition, NGAs measure financial assets,
including derivatives that are assets, at their fair values, without any
deduction for transaction costs it may incur on sale or other disposal,
except for the following financial assets:
i. Loans and receivables and held-to-maturity investments measured

at amortized cost using the effective interest method; and
ii. Investments in equity instruments that do not have a quoted market
price in an active market and whose fair value cannot be reliably
measured, and derivatives that are linked to and must be settled by
delivery of such unquoted equity instruments, which are measured
at cost.
c. Impairment
An NGA assesses at each reporting date whether there is objective

evidence that a financial asset or a group of financial assets is impaired.
A financial asset or a group of financial assets is deemed impaired if,
there is objective evidence of impairment as a result of one or more
events that has/have occurred after the initial recognition of the asset
and that loss event has an impact on the estimated future cash flows of
the financial asset or the group of financial assets that can be reliably
estimated. Evidence of impairment may include the following:
i. The debtor or a group of debtors is experiencing significant

financial difficulty;
ii. Default or delinquency in interest or principal payments;
iii. The probability that debtors will enter bankruptcy or other financial
54
reorganization; and
iv. Observable data indicates a measurable decrease in estimated future
cash flows (e.g., changes in arrears or economic conditions that
correlate with defaults).
d. Derecognition
An NGA derecognizes a financial asset or, where applicable, a part of

a financial asset or part of a group of similar financial assets when:
i. the contractual rights to the cash flows from the financial asset
expired or are waived; and
ii. an NGA has transferred its contractual rights to receive the cash
flows of the financial assets, or retains the contractual rights to
receive the cash flows of the financial assets but assumes a
contractual obligation to pay the cash flows to one or more
recipients in an arrangement that meets the conditions set forth in
PPSAS 29-Financial Instruments: Recognition and Measurement;
and either an NGA has:
1) transferred substantially all the risks and rewards of ownership

of the financial asset; or
2) neither transferred nor retained substantially all the risks and
rewards of ownership of the financial asset, but has transferred
the control of the asset.
e. Financial assets at fair value through surplus and deficit
Financial assets at fair value through surplus and deficit include

financial assets held for trading and financial assets designated upon
initial recognition at fair value through surplus and deficit. Financial
assets are classified as held for trading if they are acquired for the
purpose of selling or repurchasing in the near term.
Changes in fair value of non-derivative financial assets designated as

available-for-sale are reported in the SCNA/E.
Investments in government securities of Bond Sinking Fund (BSF) for

NG-issued bonds are financial assets classified as available-for-sale.
f. Financial assets-held to maturity
Non-derivative financial assets with fixed or determinable payments

and fixed maturities are classified as held to maturity when the agency
has the positive intention and ability to hold it to maturity.
After initial measurement, held-to-maturity investments are measured

at amortized cost using the effective interest method, less impairment.
Amortized cost is calculated by taking into account any discount or
premium on acquisition and fees or costs that are integral part of the
55
effective interest rate. The losses arising from impairment are
recognized in surplus or deficit.
Bond premiums or discounts on bond investments are added or

deducted from the Investments in Bonds account and are being
amortized over the life of the securities as adjustment to the payable
account.
3.8. Inventories
Inventories are initially recognized and measured at cost which include

purchase price, import duties and taxes, freight, handling and other costs
directly attributable to the acquisition of the finished goods, materials and
services as well as other costs incurred in bringing the inventories to their
present location and condition. Inventories acquired through non-exchange
transactions (for no cost or for a nominal cost) are measured at fair value at
the date of the acquisition.
Inventories are recognized as expense when issued for utilization or

consumption in the ordinary course of operation using the weighted average
method.
Tangible items below the capitalization threshold of P15,000 are accounted

as semi-expendable property but are also recognized as expenses upon issue
to the end-user. Minor repairs and maintenance are recognized as expense
in the period when incurred.
3.9. Investments
Bond premiums or discounts on NG-BSF and bond investments are added

to or deducted from the Investments in Bonds, and are being amortized over
the life of the securities as adjustment to Interest Income or Due to GOCCs
in the case of managed funds.
3.10. Investment property
Investment Property is either a land or a building or part of a building or

both, held by the owner or a lessee under a finance lease to earn rentals or
for capital appreciation, or both.
Investment Property is measured initially at cost, including transaction

costs. Such costs do not include start-up costs, abnormal waste, or initial
operating losses incurred before the investment property achieves the
planned level of occupancy. The carrying amount includes the
replacement cost of components of an existing investment property at
the time that cost is incurred if the recognition criteria are met.
Investment property acquired through non-exchange transaction is
56
measured at fair value at the date of acquisition.
Subsequent to initial recognition, investment property is measured

using the cost model and is depreciated over its estimated useful life
using the straight line method. Useful life of investment property is
consistent with the useful life of similar property, plant and equipment
(PPE). Investment property is also tested for impairment and
impairment losses are also recognized when appropriate. In the case of
Investment Property, Building, impairment is a loss in the future
economic benefit over and above the systematic recognition of loss of
the asset’s future economic benefit through depreciation. After
recognition of an impairment loss, the depreciation charge of the
investment property is adjusted in future periods to allocate the assets
revised carrying amount over its remaining useful life.
c. Derecognition
Investment property is derecognized upon disposal or when it is

permanently withdrawn from use or no future economic benefits are
expected from its disposal. The difference between the net disposal
proceeds and the carrying amount of the asset is recognized in surplus
or deficit in the period of derecognition. Transfer to and from
investment property is made only when there is a change in use of the
asset.
3.11. Property, plant and equipment
PPE are tangible items that are held for use in the production or supply of
goods or services, for rental to others, or for administrative purposes; and
are expected to be used during more than one period and not intended for
resale in the ordinary course of business. PPE includes land, land
improvements, buildings and other structures, machinery and equipment,
transportation equipment, furniture, fixtures and books, leasehold
improvements and other PPE including specialized military equipment,
infrastructure assets, and heritage assets.
PPE is recognized at cost. Cost includes the purchase price, including

import duties and non-refundable taxes, after deducting trade discounts
and rebates, and expenditures directly attributable to the acquisition of
the asset. Where PPE is acquired through a non-exchange transaction
or for no or nominal consideration, it is initially measured at its fair
value.
After initial recognition, PPE, except land, is stated at cost less
57
accumulated depreciation and impairment losses. Land is measured at
cost less accumulated impairment losses. Significant parts of the PPE
purchased at required intervals are recognized as individual assets with
specific useful lives. Likewise, when a major repair/replacement is
done, its cost is recognized in the carrying amount of the PPE as a
replacement if the recognition criteria are satisfied. All other repair and
maintenance costs are recognized as expense in the surplus or deficit in
the period in which they are incurred.
c. Depreciation
PPE is depreciated over its useful life using the straight-line method
after assigning a residual value of at least five percent. The specific
useful life of a PPE is determined by an NGA based on the ranges
prescribed by the COA. Significant parts of the PPE purchased at
required intervals are depreciated over their specific useful lives. For
simplicity and to avoid proportionate computation, the depreciation is
for one month if the PPE is available for use on or before the 15th of the
month. However, if the PPE is available for use after the 15th of the
month, depreciation starts in the succeeding month.
d. Impairment
PPE is assessed at each reporting date to determine the existence of

impairment. Impairment loss on a PPE is recognized if the carrying
amount is greater than its estimated recoverable amount or recoverable
service amount. After recognition of an impairment loss, the
depreciation charge of the PPE is adjusted in future periods to allocate
the assets revised carrying amount over its remaining useful life.
e. Derecognition
PPE and/or any significant part of a PPE is derecognized upon disposal

or when no future economic benefits or service potential is expected
from its continued use. Any gain or loss arising from derecognition of
the asset is included in surplus or deficit.
3.12. Construction in progress
Construction in Progress (CIP) is stated at cost. While the construction is

in progress, the project costs are accrued based on the contractor’s
accomplishment reports and billings. These represent costs incurred for
technical services and capital works program contracted by the NGAs to
facilitate the implementation of projects. While the construction of the
project is in progress, no provision for depreciation is recognized.
CIP is transferred to the appropriate asset account when the construction or

installation and related activities necessary to prepare the asset for its
intended use have been completed, and the asset is ready for service.
58
3.13. Leases
a. Operating lease – lessee’s books
Lease payments under operating lease are recognized as expense on a

straight-line basis over the lease term unless another systematic basis is
representative of the time pattern of the lessee’s benefit.
b. Operating lease – lessor’s books
Lease revenue from operating lease is recognized on a straight-line

basis over the lease term unless another systematic basis is
representative of the time pattern in which benefits derived from the
lease assets is diminished. Initial direct costs, such as finder’s fees and
legal expenses, incurred in negotiating and arranging the operating
lease agreement are added to the carrying amount of the leased asset
and recognized as expense over the lease term on the same basis as the
lease revenue. Contingent rents are recognized as revenue in the period
in which they are earned.
Leased assets are depreciated consistent with the lessor’s normal

depreciation policy for similar assets.
c. Finance lease – lessee’s books
Assets held under a finance lease are capitalized at the commencement

of the lease at the fair value of the leased property or, if lower, at the
present value of the minimum lease payment. The associated liability is
recognized at the inception of the lease which is measured at the present
value of the future minimum lease payments at initial recognition.
Lease payments are apportioned between reduction of the lease liability

and finance charges. A constant rate of interest on the remaining
balance of the liability shall be applied. Finance charges are recognized
as finance costs in surplus or deficit.
Assets under a finance lease are depreciated over their useful lives,
however, if there is no reasonable certainty that the lessee obtains
ownership of the asset at the end of the lease term, the asset is
depreciated over the shorter of the estimated useful life of the asset and
the lease term.
d. Finance lease – lessor’s books
The lessor recognizes Finance Lease Receivable at an amount equal to

the net investment in the lease and finance revenue based on a pattern
reflecting a constant periodic rate of return on the net investment in the
lease. Initial direct costs such as commissions, legal fees, and internal
costs are included in the initial measurement of the Finance Lease
Receivable, and reduce the amount of revenue recognized over the lease
59
term.
3.14. Intangible assets
An intangible asset is an identifiable non-monetary asset without physical

substance.
Intangible asset is recognized when it is identifiable, when it is probable

that the expected future economic benefits or service potential that are
attributable to the asset will flow to the agency, and when the cost or
fair value of the asset can be measured reliably.
Intangible asset acquired through purchase or by separate acquisition is

initially recognized at cost which includes non-refundable taxes and
other directly attributable costs. The cost of intangible asset acquired in
a non-exchange transaction is its fair value at the time of acquisition.
The cost of internally generated intangible asset, excluding capitalized
development costs, is recognized in surplus or deficit. No intangible
asset arising from research (or from the research phase of an internal
project) is recognized. Expenses on research (or on the research phase
of an internal project) is recognized as expense when incurred.
Expenditure on intangible asset is recognized as expense when it is
incurred unless it forms part of the cost that meets the recognition
criteria of an intangible asset.
After initial recognition, intangible assets are carried at cost less any
accumulated amortization and accumulated impairment losses. The
useful life of the intangible asset is assessed as either finite or indefinite.
Those with finite lives are amortized over their useful lives using the
straight-line method. The amortization expense is recognized in surplus
or deficit.
Intangible assets with indefinite useful lives are not amortized but are
required to be tested for impairment at least annually or whenever there
is an indication of impairment. An intangible asset is impaired when its
carrying amount is greater than the estimated recoverable amount or
recoverable service amount. Amortization begins when the intangible
asset is available for use and ceases at the earlier of the date that the
asset is classified as held for sale and the date that the asset is
derecognized.
Gains or losses arising from derecognition of an intangible asset are

measured as the difference between the net disposal proceeds and the
carrying amount of the asset and are recognized in surplus or deficit.
60
3.15. Financial liabilities
NGAs recognize financial liabilities in their respective books of

accounts when they become party to the contractual provisions of the
instrument. A financial liability is measured initially at its fair value
plus, in the case of financial liability not measured at fair value through
surplus or deficit, transaction costs that are directly attributable to the
acquisition or issue of the financial liability.
Financial liabilities within the scope of PPSAS 29 are classified as:

(1) financial liabilities at fair value through surplus or deficit; and
(2) loans and borrowings, as appropriate. NGAs’ financial liabilities
include trade and other payables, loans and borrowings.
After initial recognition, NGAs measure financial liabilities at

amortized cost using the effective interest method except for:
i. financial liabilities at fair value through surplus or deficit. Such

liabilities, including derivatives that are liabilities, are measured at
fair value except for a derivative liability that is linked to and must
be settled by delivery of an unquoted equity instrument whose fair
value cannot be reliably measured, which shall be measured at cost;
ii. financial liabilities that arise when a transfer of a financial asset
does not qualify for derecognition or when the continuing
involvement approach applies; and
iii. financial guarantee contracts which are measured at the higher of
the amount determined as provision, and the amount initially
recognized net of cumulative amortization recognized.
Amortized cost is calculated by taking into account any discount or

premium on acquisition and fees or costs that are integral part of the
effective interest rate.
c. Financial liabilities at fair value through surplus or deficit
Financial liabilities at fair value through surplus or deficit include

financial liabilities held for trading and financial liabilities designated
upon initial recognition at fair value through surplus or deficit.
Financial liabilities are classified as held for trading if these are
acquired for the purpose of selling or repurchasing in the near term.
d. Loans and borrowings
After initial recognition, interest bearing loans and borrowings are

subsequently measured at amortized cost using the effective interest
method. Gains or losses arising from the derecognition of the liabilities
61
as well as through the effective interest method amortization process
are recognized in surplus or deficit. Amortized cost is calculated by
taking into account any discount or premium on acquisition and fees or
costs that are integral part of the effective interest rate. Bond discounts
and premiums on the issuance of foreign and domestic treasury bonds
and bond exchanges are amortized over the remaining life of the bonds.
e. Derecognition
A financial liability is derecognized when the obligation specified in

the contract expires or is discharged, cancelled or waived.
When an existing financial liability is replaced by another from the

same lender on substantially different terms, or the terms of an existing
liability are substantially modified, such an exchange or modification
is treated as a derecognition of the original liability and recognition of
a new liability. The difference between the carrying amount of a
financial liability (or a part of a financial liability) extinguished or
transferred to another party and the consideration paid, including any
non-cash assets transferred or liability assumed, is recognized in
surplus or deficit.
f. Contingent liabilities
Contingent liabilities are not recognized in the books of accounts but

are disclosed in the Notes to FSs.
3.16. Provisions
Provisions are liabilities of uncertain timing and amount. Provisions are

recognized when NGAs have present obligations (legal or constructive) at
the reporting date as a result of a past event, it is probable that an outflow
of resources embodying economic benefits or service potential will be
required to settle the obligation, and a reliable estimate can be made of the
amount of obligation. Provision is recognized at the best estimate of the
expenditure to settle the obligation. Best estimate is an amount that an NGA
would rationally pay to settle the obligation at the reporting date or to
transfer it to a third party. Best estimate is usually based on costs incurred
by an NGA and not on the transfer price to a third party which could include
a margin. Further, the risks and uncertainties that inevitably surround many
events and circumstances are taken into account in reaching the best
estimates of a provision. The expense relating to any provision is
recognized in surplus/deficit.
3.17. Revenue from non-exchange transactions
a. Recognition of assets from non-exchange transactions
An inflow of resources from a non-exchange transaction, other than

services in-kind, that meets the definition of an asset is recognized as
62
an asset if it is probable that the future economic benefits or service
potential associated with the asset will flow to the entity; and if the fair
value of the asset can be measured reliably. An asset acquired through
a non-exchange transaction is initially measured at fair value at the date
of acquisition.
b. Recognition and measurement of revenue from non-

exchange transactions
An inflow of resources from a non-exchange transaction recognized as

an asset is recognized as revenue, except to the extent that a liability
was also recognized in respect of the same inflow.
As the recipient NGA satisfies the present obligation recognized as a

liability in respect of an inflow of resources from a non-exchange
transaction recognized as an asset, the carrying amount of the liability
recognized is reduced and an amount of revenue equal to that reduction
is recognized.
Revenue from a non-exchange transaction is measured at the amount of

the increase in net assets recognized by the NGA, unless a
corresponding liability is recognized.
c. Measurement of liabilities on initial recognition from

non-exchange transactions
The amount recognized as a liability in a non-exchange transaction is

the best estimate of the amount required to settle the present obligation
at the reporting date.
d. Taxes
Taxes and the related fines and penalties are recognized when collected
or when these are measurable and legally collectible. The related
refunds that are measurable and legally due to the taxpayers are
deducted from the recognized tax revenue if refunds are done during
the year the taxes are collected.
e. Fees and fines not related to taxes
Revenue from fees and fines, except those related to taxes, is

recognized when earned and when the asset recognition criteria are met.
Deferred income is recognized instead of revenue if there is a related
condition attached that would give rise to a liability to repay the
amount.
Other non-exchange revenue is recognized when it is probable that the

future economic benefits or service potential associated with the asset
will flow to the entity and the fair value of the asset can be measured
reliably.
63
f. Gifts and donations
Assets and revenue from gifts and donations are recognized when it is
probable that the future economic benefits or service potential will flow
to the agency and when the fair value of the assets can be measured
reliably.
Goods in-kind are recognized as assets when the goods are received, or
when there is a binding arrangement to receive the goods. If goods in-
kind are received without condition, revenue is recognized
immediately. If conditions are attached, a liability is recognized, which
is reduced as revenue is recognized when the conditions are satisfied.
Gifts and donations including goods in-kind are initially measured at

fair value as at the date of acquisition, which is ascertained by reference
to an active market, or by appraisal. An appraisal of the value of an
asset is normally undertaken by a member of the valuation profession
who holds a recognized and relevant professional qualification. For
many assets, the fair value is ascertained by reference to quoted prices
in an active and liquid market.
g. Transfers
Assets in respect of transfers are recognized when the transferred

resources meet the definition of an asset and the criteria for recognition
as an asset is satisfied, except those arising from services in-kind.
h. Services in-kind
Services in-kind are not recognized as asset nor revenue considering the
complexity of the determination and recognition of asset and revenue
and the eventual recognition of expenses.
i. Transfers from other government agencies
Revenue from non-exchange transactions with other government

agencies and the related assets are measured at fair value and
recognized on obtaining control of the asset (cash, goods, services and
property) if the transfer is free from conditions, it is probable that future
economic benefits or service potential related to the asset will flow to
the agency and can be measured reliably.
3.18. Revenue from exchange transactions
a. Measurement
Revenue from exchange transactions are measured at the fair value of

the consideration received or receivable. Revenue are recognized when
it is probable that the future economic benefits or service potential will
flow to the agency and when these benefits can be measured reliably.
64
b. Rendition of services
Revenue from the rendition of services is recognized by reference to

the stage of completion when the outcome of the transaction can be
estimated reliably. The stage of completion is measured by reference to
labor hours incurred to date as a percentage of total estimated labor
hours.
Where the contract outcome cannot be measured reliably, revenue is

recognized only to the extent that the expenses incurred are recoverable.
c. Sale of goods
Revenue from the sale of goods is recognized when the significant risks
and rewards of ownership are transferred to the buyer, usually upon
delivery of the goods and when the amount of revenue can be measured
reliably and when it is probable that future economic benefits or service
potential associated with the transaction will flow to the agency.
d. Interest income
Interest income is accrued using the effective yield method. The

effective yield discounts estimated future cash receipts through the
expected life of the financial asset to that asset’s net carrying amount.
The method applies this yield to the outstanding principal to determine
interest income for each period.
e. Dividends
Dividends or similar distributions are recognized when the agency’s

right to receive payments is established.
3.19. Foreign currency transactions
Transactions in foreign currencies are recorded in Philippine peso based on

Bangko Sentral ng Pilipinas (BSP) exchange rate prevailing at the date of
the transaction. Foreign currency denominated monetary assets and
liabilities at the reporting date are restated based on BSP Weighted Average
Rate published on the first working day of the following month in the BSP
Reference Exchange Rate Bulletin. Any difference in the revaluation of
assets and liabilities is recognized as a gain or loss on foreign exchange.
3.20. Budget information
The annual budget is prepared on a cash basis and is published in the

government website. In order to enable comparability between budget and
actual results, it is imperative that both budgeting and reporting systems are
prepared under similar assumptions making them easier to understand and
assess. The symmetry is fundamental as it determines accountability for
implementing the budget as authorized.
65
A separate SCBAA was prepared since the budget and the FSs were not
prepared on comparable basis.
The SCBAA is presented showing the original and final budget, and the
actual results of operations. Explanatory comments on the overall
growth/decline of the budget including overspending/underspending are
provided in Note 53 of this Report.
4. CASH AND CASH EQUIVALENTS
The total Cash and Cash Equivalents as at December 31, 2017 is accounted under
the following sub-major groups of accounts:
2017 2016 (Restated)

Amount Amount
Sub-Major Group of Accounts Percent Percent
(in thousand (in thousand
to total to total
pesos) pesos)
Cash on Hand 2,339,608 0.33 7,083,270 1.59
Cash in Bank-Local Currency 664,231,746 93.00 399,203,164 89.82
Cash in Bank-Foreign Currency 42,091,367 5.89 32,277,110 7.26
Cash Equivalents 5,595,167 0.78 5,901,457 1.33
Sub-Total 714,257,888 100.00 444,465,001 100.00
Less: Treasury/Agency Cash
Accounts 476,926,193 406,738,247
Total 237,331,695 37,726,754
4.1. Cash on Hand
Cash on Hand consists of Cash-Collecting Officers and Petty Cash

amounting to P2.04 billion and P296.92 million, respectively.
a. Cash-Collecting Officers
This refers to the sum of money received by authorized collecting

officers which remained unremitted/undeposited to the National
Treasury and/or to authorized government depository banks (AGDBs)
as at the reporting date. The departments/offices that reported balances
of this account are as follows:
Amount Percent
Department/Office
(in thousand pesos) to Total
Finance 397,647 19.47
Justice 370,205 18.12
The Judiciary 284,390 13.92
State Universities and Colleges 179,863 8.81
Health 171,847 8.41
Budget and Management 130,723 6.40
Public Works and Highways 115,816 5.67
Transportation 96,612 4.73
Information and Communications Technology 59,457 2.91
66
Amount Percent
Department/Office
Labor and Employment 40,720 1.99
Sub-total 1,847,280 90.43
Other Departments/Offices 195,405 9.57
Total 2,042,685 100
The unremitted/undeposited collections accounted by Department of

Finance (DOF) pertained primarily to the Bureau of Customs (BOC),
Bureau of Internal Revenue (BIR) and Bureau of the Treasury (BTr) of
P250.12 million, P48.62 million and P47.50 million, respectively. The
amount pertaining to the BTr applies to the NG books which includes
the following:
Amount
Particulars
(in thousand pesos)
Escheated unclaimed balance for the odd year 2007 per Civil
Case No. MC 12-6521 35
Check representing settlement of penalty fee charged to
Rural Bank of Talisayan, Incorporated 4
Check representing settlement of escheat fees for the odd
year 2003 per Civil Case No. 15-133175 31,864
National Irrigation Administration’s payment for 5% final
tax and 2% expanded withholding tax on water delivery
fee for the period 9/25/17 to 10/25/17 15,594
Penalty charged to BPI for failure to submit sworn statement
and list of unclaimed balances within the period
prescribed by the law 5
Total 47,501
The balance of P370.21 million reported by the Department of Justice

(DOJ) is composed mainly of unremitted service fees imposed by Land
Registration Authority (LRA) through the 166 Registries of Deeds
nationwide. This also includes the balance of the Bureau of
Immigration (BI) of P55.46 million which pertains to the following:
Amount
Particulars
(in thousand pesos)
Trust Funds 6,562
Miscellaneous income 37,406
Alien Certificate of Registration Identity Card 10,793
Other legal collections 695
Total 55,457
The amount reported by the Judiciary refers to the

unremitted/undeposited receipts held by the Supreme Court of the
Philippines (SCP), Sandiganbayan and the Court of Appeals of P284.33
million, P40.31 thousand and P21.65 thousand, respectively.
Schedule 5, Volume II of this Report shows the list of agencies with

balances of Cash-Collecting Officers.
67
b. Petty Cash
This account refers to unexpended portion of the PCF still in the

possession of Petty Cash Custodians as at the reporting date.
The departments/offices which reported balances of Petty Cash are as

follows:
Amount Percent
Department/Office
Interior and Local Government 65,609 22.10
Health 58,895 19.84
Other Executive Offices 18,164 6.12
Social Welfare and Development 16,446 5.54
National Defense 16,282 5.48
Education 9,037 3.04
Agriculture 5,764 1.94
Justice 5,748 1.94
Sub-total 256,663 86.44
Total 296,923 100.00

balances of Petty Cash.
4.2. Cash in Bank-Local Currency
Cash in Bank-Local Currency is composed of the following accounts:

Amount Amount
Account Percent Percent
to Total to Total
pesos) pesos)
Bangko Sentral ng Pilipinas 310,353,974 46.72 124,835,543 31.27
Current Account 187,817,669 28.28 156,954,918 39.32
Savings Account 59,935,197 9.02 50,574,706 12.67
Time Deposits 106,124,907 15.98 66,837,997 16.74
Total 664,231,747 100.00 399,203,164 100.00
a. Cash in Bank-Local Currency, Bangko Sentral ng Pilipinas
This account is used to recognize the deposits with the BSP. The
departments/offices which reported balances of this account are as
follows:
68
Amount Percent
Department/Office
Finance 310,353,178 100.00
Other Executive Offices 794 0.00
Agriculture 2 0.00
Total 310,353,974 100.00
The BTr recognized the total for the DOF which represents deposits for
its collections from NGAs, proceeds from the issuances/flotations and
maturities of treasury bills (T-Bills) and treasury bonds (T-Bonds), and
fund transfers from other cash accounts of the BTr.
b. Cash in Bank-Local Currency, Current Account
This account is used to recognize the deposits made by the agencies to

AGDBs for income authorized to be used under specific laws and trust
receipts authorized under specific contracts and agreements.
The departments/offices maintaining peso deposits in current account

with AGDBs are as follows:
Amount Percent
Department/Office
State Universities and Colleges 29,369,362 15.64
Finance 27,618,026 14.70
Social Welfare and Development 21,542,195 11.47
National Defense 15,065,697 8.02
Education 14,500,986 7.72
Office of the President 14,107,710 7.51
Health 12,849,803 6.84
Other Executive Offices 5,873,094 3.13
Budget and Management 5,496,242 2.93
Public Works and Highways 4,356,003 2.32
Sub-total 150,779,118 80.28
Other Departments/Offices 37,038,551 19.72
Total 187,817,669 100.00
The total peso deposits of SUCs were reported by 113 tertiary schools
with the University of the Philippines System (UPS) having the highest
balance of P4.36 billion, followed by Cavite State University with
P1.06 billion.
The list of agencies with balances of Cash in Bank-Local Currency,

Current Account as at December 31, 2017 is shown in Schedule 7,
Volume II of this Report.
c. Cash in Bank-Local Currency, Savings Account
Cash in Bank-Local Currency, Savings Account is used in the BTr-NG

books to recognize deposits to savings account with AGDBs for fees
and charges collected by national collecting officers, investments of
69
funds, maturity of investments, and proceeds of over-the-counter
placement of T-Bills and T-Bonds. This account may also be
maintained by the BIR, BOC and other authorized agencies for amounts
held in escrow.
The peso savings accounts in local currency maintained with AGDBs

was reported by the following departments/offices:
Amount Percent
Department/Office
Finance 35,573,397 59.35
The Judiciary 16,768,139 27.98
Trade and Industry 1,511,190 2.52
Health 1,095,937 1.83
Foreign Affairs 168,404 0.28
Sub-total 59,414,167 99.13
Total 59,935,197 100.00

balances of Cash in Bank-Local Currency, Savings Account as at
December 31, 2017.
d. Cash in Bank-Local Currency, Time Deposits
Time deposits in local currency maintained with AGDBs was reported

by ten departments/offices, as follows:
Amount Percent
Department/Office
Finance 70,023,348 65.98
Transportation 1,233,333 1.16
Civil Service Commission 2,658 0.00
Science and Technology 26 0.00
Total 106,124,907 100.00

balances of Cash in Bank-Local Currency, Time Deposits as at
December 31, 2017.
70
4.3. Cash in Bank-Foreign Currency
Cash in Bank-Foreign Currency is composed of the following:

Amount Amount
to Total to Total
pesos) pesos)
Bangko Sentral ng Pilipinas 15,150,896 36.00 11,031,288 34.18
Current Account 6,517,987 15.49 5,222,083 16.18
Savings Account 9,627,270 22.87 10,575,219 32.76
Time Deposits 10,795,215 25.65 5,448,520 16.88
Total 42,091,367 100.00 32,277,110 100.00
a. Cash in Bank-Foreign Currency, Bangko Sentral ng Pilipinas
This account is used to recognize in the BTr books the deposits with the
BSP of collections of NGAs, proceeds from borrowings and grants, and
proceeds from maturities on investments in foreign currencies.
b. Cash in Bank-Foreign Currency, Current Account
The total foreign currency deposits in current account maintained with

AGDBs was reported by six departments/offices, as follows:
Amount Percent
Department/Office
Foreign Affairs 6,105,316 93.67
Health 61,715 0.95
Finance 34,566 0.53
Autonomous Region in Muslim Mindanao 11,830 0.18
Total 6,517,987 100.00
The entire amount of P6.11 billion of the Department of Foreign Affairs

(DFA) pertains to Cash in Bank of foreign service posts for working
funds, including the balance of International Commitment Fund.
c. Cash in Bank-Foreign Currency, Savings Account
The departments/offices with foreign currency deposits in savings

accounts with AGDBs are as follows:
Amount Percent
Department/Office
Finance 3,799,306 39.46
Energy 946,910 9.84
71
Amount Percent
Department/Office
Justice 374,779 3.89
Environment and Natural Resources 140,122 1.46
Sub-total 9,311,891 96.72
Total 9,627,270 100.00
The amount reported by the DOF includes the deposits held by the BTr,
DOF-Office of the Secretary (OSEC) and BIR of P3.78 billion, P15.72
million and P43.31 thousand, respectively.
The deposits maintained by Department of Social Welfare and

Development (DSWD)-OSEC includes receipt of grants and donations,
and loan proceeds from the following:
i. National Community Driven Development Project (NCDDP)-

World Bank and Asian Development Bank (ADB)
ii. Social Protection Support Project
iii. Social Welfare and Development Reform Project
iv. DSWD Foreign Donations
v. JSDF: Community Enterprise Development as Pathway Out of
Poverty
vi. Kapitbisig Laban sa Kahirapan-Comprehensive and Integrated
Delivery of Social Services (KALAHI-CIDSS) NCDDP ADB AF
Typhoon Yolanda Multi-Donor Trust Fund
vii. Association of Southeast Asian Nations (ASEAN)-Republic of
Korea
viii. Japan ASEAN Integration Fund/Japan Fund
The balances reported by the Department of Energy were maintained

with the following local banks:
Amount
Banks
(in thousand pesos)
Philippine National Bank 782,083
Banco de Oro 150,807
Land Bank of the Philippines 14,020
Total 946,910
The deposits with the Philippine National Bank (PNB) represent the
partial credit guarantee component of the Electric Cooperative System
Loss Reduction Project which is currently in escrow. The said project
aims to assist the government in promoting energy efficiency
improvements through providing reliable and least cost power supply,
reducing carbon dioxide emissions and other pollutants, and providing
investments for electric cooperatives.
72
The amount maintained with Banco de Oro is intended for the
“Capacity Building to Remove Barriers to Renewable Energy
Development” Project funded under Global Environmental Facility
Fund. This project was initially implemented in 2003, and concluded in
2012. The said trust funds, however, has not yet been turned over to the
BTr as at year-end.

balances of Cash in Bank-Foreign Currency, Savings Account as at
December 31, 2017.
d. Cash in Bank-Foreign Currency, Time Deposits
The time deposits in foreign currency maintained with local banks was
reported by only three departments/offices, as follows:
Amount Percent
Department/Office
Finance 10,704,392 99.16
Trade and Industry 41,436 0.38
Total 10,795,215 100.00
The cumulative amount for the DOF corresponds to the balance

accounted in the BTr-NG books. The total for the SUCs pertains to
balances of UPS and Mariano Marcos State University of P46.69
million and P2.69 million, respectively. The balance for the Department
of Trade and Industry (DTI) refers to US dollar denominated high yield
time deposit recognized by the Intellectual Property Office (IPO).
4.4. Other Notes on Local and Foreign Currency Deposits
The total of cash in bank accounts of the BTr of P468.46 billion comprises
deposits in local currency of P438.82 billion and in foreign currencies
equivalent to P29.64 billion. These deposits consist of the following:
Amount
Particulars
(in thousand pesos)
Free balances 393,932,847
Modified Disbursement System (MDS) seed money 12,050,860
Restricted accounts 57,180,513
Project loan/grant proceeds 5,293,360
Total 468,457,579
Free balances pertain to the amounts available for use in the operations of
the NG. Details are as follows:
73
Amount Percent
Particulars
Treasurer of Philippines (TOP)-Treasury Single
Account (TSA) 252,205,194 64.02
BSP Foreign Currency Deposit (FCD), Dollar
Account 10,611,299 2.69
BSP-Foreign Currency Time Deposit (FCTD),
Dollar Account 2,100,126 0.53
LBP-Local Currency Time Deposit 55,000,000 13.96
LBP-FCD, Dollar Account 2,245,938 0.57
Land Bank of the Philippines (LBP)-FCTD, Dollar
Account 10,271,751 2.61
DBP Local Currency Time Deposit 15,000,052 3.81
United Coconut Planters Bank-Savings Account 30,000,586 7.62
Authorized Agent Banks (AAB)-BIR 8,863,828 2.25
AAB-BOC 2,866,197 0.73
Various accounts 4,767,877 1.21
Total 393,932,847 100.00
Of the total free cash balances, P599.23 million is considered dormant.
The MDS Seed Money refers to the portion of cash reserved to pay
expenditures charged against MDS accounts. This is being replenished
daily by the BTr upon request by Authorized Servicing Banks (ASBs). The
MDS Seed Money includes the following accounts:
Amount
Bank Account
(in thousand pesos)
Land Bank of the Philippines-MDS 11,379,359
Development Bank of the Philippines-MDS 579,819
Philippine Veterans Bank-MDS 91,682
Total 12,050,860
Restricted accounts represent special/sinking funds, managed funds and

escrow accounts. These consist the following accounts:
Amount
Bank Account
(in thousand pesos)
TSA (National Government Bond Sinking Fund) 1,471,536
TSA (NFA Bond Sinking Fund) 4,381,622
TSA (Securities Stabilization Fund) 1,556,257
TSA (Forfeited Swiss Deposit) 2,806,297
TSA (PCGG Coconut Industry Investment Fund) 13,390,437
TSA (NCCA) 1,228,803
BSP-D/D-S/A No. 2 – under MOA-MBR 560 28,265,953
LBP SA PD Agro Industry Modernization Credit and
Financing Program (AMCFP) 1,106,741
2nd Tropical Forest Conservation Account Fund 1,132,044
Various accounts 1,840,822
Total 57,180,513
74
Project Loan Grant Proceeds refer to the amounts earmarked for utilization
by various implementing agencies. These include the following:
Amount
Bank Account
(in thousand pesos)
Bangko Sentral ng Pilipinas
a) Peso Deposits (various) 3,599,164
b) Foreign Currency Deposits (various) 1,694,149
Land Bank of the Philippines
a) Foreign Currency Deposits (various) 46
Total 5,293,359
4.5. Treasury/Agency Cash Accounts
This sub-major group of cash accounts consists of the following:
2016
2017
Account (Restated)
(in thousand pesos)
Cash-Treasury/Agency Deposit, Special Account
(Reported by NGAs except the BTr) 48,723,268 25,891,051
Less: BTr-NG Credit Balance 432,793,112 359,025,952
Sub-Total (384,069,844) (333,134,901)
Cash-Treasury/Agency Deposit, Trust
(Reported by NGAs except the BTr) 25,600,865 24,580,805
Less: BTr-NG Credit Balance 118,457,215 98,184,151
Sub-Total (92,856,350) (73,603,347)
Total (476,926,193) (406,738,247)
For FY 2017, the BTr-NG Books reported credit balances of Cash-

Treasury/Agency Deposit, Special Account and Cash-Treasury/Agency
Deposit, Trust in the amount of P432.79 billion and P118.46 billion,
respectively. Other NGAs reported debit balances of P48.72 billion, and
P25.60 billion for the same accounts, respectively. The Cash-
Treasury/Agency Deposit cash accounts are reciprocal accounts in the
books of the BTr-NG and other NGAs and should have been reconciled and
eliminated at the end of the year. However, the non-reconciliation of these
accounts by the BTr-NG and other NGAs resulted in the net credit balance
of Cash-Treasury/Agency Deposit, Special Account of P384.07 billion and
Cash-Treasury/Agency Deposit, Trust of P92.86 billion, thereby
understating the total cash and cash equivalents of the NG by P476.93
billion. The BTr, therefore, requires all agencies concerned to provide
copies of Statement of Account and Utilization Reports to identify
discrepancies and effect adjustments, if appropriate.
The departments/offices with balances of Cash-Treasury/Agency accounts

are as follows:
75
Treasury/ Treasury/
Agency Deposit, Agency Total Percent
Department/Office Special Account Deposit, Trust to Total
(in thousand pesos)
Transportation 16,570,365 507,144 17,077,509 22.98
Justice 6,007,892 2,463,083 8,470,975 11.40
Energy 7,575,327 - 7,575,327 10.19
Public Works and Highways 351,705 6,297,522 6,649,227 8.95
Interior and Local
Government 4,418,127 1,273,833 5,691,960 7.66
National Defense 2,615,451 1,140,868 3,756,319 5.05
Other Executive Offices 3,325,213 305,550 3,630,763 4.89
Health 1,536,855 1,280,771 2,817,626 3.79
Resources 913,981 1,140,767 2,054,748 2.76
Office of the President - 2,010,706 2,010,706 2.71
Sub-Total 43,314,915 16,420,243 59,735,158 80.37
Other Departments/ Offices 5,408,353 9,180,622 14,588,975 19.63
Total 48,723,268 25,600,865 74,324,133 100.00
BTr-NG (credit balance) 432,793,112 118,457,215 551,250,327
Total (384,069,844) (92,856,350) (476,926,193)

balances of Treasury/Agency Deposits Accounts.
a. Cash-Treasury/Agency Deposit, Special Account
This account refers to the collections of various NGAs pertaining to

SAGF that were remitted to the BTr. This includes, among others, the
remittances of the Department of Transportation (DOTr) for the
collections under Motor Vehicle Users’ Charge Fund and Seat Belt Use
Fund amounting to P15.89 billion and P77.20 million, respectively.
This also comprises the receipts of the DOJ of P4.24 billion
representing the 20 percent share of the LRA from land registration fees
under Presidential Decree (P.D.) No. 1529, and P7.58 billion for the 20
percent share of the Department of Energy (DOE) from the collections
of various fees arising from service contracts per P.D. No. 910.
Also forming part of Cash-Treasury/Agency Deposit, Special Account

are remittances of the Department of the Interior and Local Government
(DILG) comprising the collections of the Bureau of Fire Protection
(BFP) from fees and fines specified under Republic Act (R.A.) No.
9514 amounting to P4.42 billion.
The complete list of SAGF maintained by NGAs and their individual

UACS codes can be accessed through the UACS manual prescribed
under COA-DBM-DOF Joint Circular No. 2013-1 dated August 6,
2013, and through the UACS website (http://www.uacs.gov.ph).
b. Cash-Treasury/Agency Deposit, Trust
This account is used to recognize the remittances of collections of
76
NGAs for trust receipts and trust funds. This includes, among others,
inter-agency fund transfers, collections of security deposits, and
receipts from grants/donations with term of one year or less.
As at December 31, the balance of this account was composed mainly

of the remittances from the Department of Public Works and Highways
(DPWH)-OSEC aggregating to P6.30 billion. Of the P2.46 billion
balance of the DOJ, remittances of Presidential Commission on Good
Governance (PCGG) amounted to P1.45 billion or 58.72 percent which
includes proceeds from the sale of Wack Wack property of P111
million awaiting for resolution of legal issues before it can be accrued
to the Comprehensive Agrarian Reform Program (CARP) Fund.
4.6. Cash Equivalents
a. Treasury Bills
Cash Equivalents refers to T-Bills issued by the NG through the BTr

with a maturity period not exceeding 90 days. The total amount of P5.60
billion as at year-end was accounted specifically by the DOE, Other
Executive Offices (OEO) and Department of National Defense (DND).
The T-Bills of P3.40 billion pertaining to DOE refer to placements

made under Energy Regulation (ER) No. 1-94 with the LBP with
maturity of three months or less from the date of acquisition. This
includes the following short term, highly liquid investments:
Maturity Terms Amount

Date Placed Rate
Date (in days) (in thousand pesos)
12/13/17 02/14/18 63 2.575% 280,709
12/13/17 02/14/18 63 2.52% 28,947
12/13/17 02/14/18 63 2.575% 570,994
11/08/17 01/31/18 84 2.11% 1,331,901
10/25/17 01/03/18 70 2.0275% 1,190,201
Total 3,402,752
ER No. 1-94 represents the one-centavo kilowatt hour on electricity

sales as benefits to the Local Government Units (LGUs) for
electrification, development and livelihood, restoration, watershed
management, health and/or environment enhancement.
The T-Bills of P1.89 billion of the OEO represents the short-term

investments of the National Commission of Culture and the Arts
(NCCA) under the National Endowment Fund for Culture and the Arts.
The Cash Equivalents of P304.72 million reported by the DND consist

of T-Bills placed by the General Headquarters, Armed Forces of the
Philippines (GHQ-AFP) with the DBP and LBP. These investments
yield interests of 2.05 to 2.8725 percent, and are expected to mature in
2018.
77
5. INVESTMENTS
The current portion of NG investments comprises the following sub-major groups

of accounts:

Amount Amount
to Total to Total
pesos) pesos)
Financial Assets at Fair Value Through
Surplus or Deficit 920 0.00 920 0.00
Financial Assets-Held to Maturity 13,416,198 14.20 11,279,023 14.89
Sinking Fund 81,048,010 85.80 64,485,999 85.11
Total 94,465,128 100.00 75,765,942 100.00
5.1. Financial Assets at Fair Value Through Surplus or Deficit
The Financial Assets at Fair Value through Surplus or Deficit consist of

investments retained by the Philippine Normal University in preferred
stocks, and deposits for new electric meter to Manila Electric Company
(MERALCO).
5.2. Financial Assets-Held to Maturity
This was composed of the following accounts:

Amount Amount
to Total to Total
pesos) pesos)
Investments in Treasury Bills-
Local 13,391,693 99.82 11,254,606 99.78
Investments in Treasury
Bonds-Local 24,505 0.18 24,417 0.22
Total 13,416,198 100.00 11,279,023 100.00
a. Investments in Treasury Bills-Local
The total Investments in Treasury Bills-Local issued by the NG through

the BTr was reported by five departments/offices, as follows:
Amount Percent
Department/Office
Finance 12,513,543 93.44
Total 13,391,693 100.00
78
b. Investments in Treasury Bonds-Local
Investments in Treasury Bonds-Local amounting to P24.51 million

pertained to retail T-Bonds acquired by the University of Northern
Philippines through LBP. The increase of P88.09 thousand pertained to
the amortization of the discount availed during its acquisition.
5.3. Sinking Fund
The current portion of the Sinking Fund refers to the amount set aside to
pay off at maturity long-term debts such as bonds with maturity period of
three years or more.
For FY 2017, the balance of P81.05 billion reported by the BTr consisted
of investments in time deposits and T-Bills, and Bond Sinking Fund set
aside to cover redemption of issued and outstanding bonds of LBP-
Agrarian Reform Fund (ARF). Details are as follows:
Amount
Particulars
(in thousand pesos)
BSF-TD (DBP) 20,000,000
BSF-TD (LBP) 20,000,000
BSF-TD (UCPB) 5,000,000
BSF-FCTD-Dollar (DBP) 16,271,079
BSF-FCTD-Dollar (LBP) 15,593,600
BSF-FCTD-Dollar (UCPB) 506,478
BSF-Securities (Treasury Bills) 3,437,273
LBP- ARF BSF 239,530
Total 81,047,960
6. RECEIVABLES
Receivables aggregated to P854.92 billion, net of Allowance for Impairment of

P8.17 billion. These receivables are composed of the following sub-major groups:

Amount Amount
to Total to Total
pesos) pesos)
Loans and Receivable Accounts 115,712,280 13.53 101,887,915 12.93
Lease Receivables 1,322,120 0.15 1,317,322 0.17
Inter-Agency Receivables 661,329,674 77.36 615,954,149 78.18
Intra-Agency Receivables 9,889,302 1.16 6,836,429 0.87
Other Receivables 66,664,162 7.80 61,845,253 7.85
Total 854,917,537 100.00 787,841,069 100.00
Schedule 10, Volume II of this Report shows the list of agencies with existing
balances of the aforementioned receivable accounts.
79
6.1. Loans and Receivable Accounts
This sub-major group of accounts is composed of the following:
Allowance
Gross Carrying
for Percent
Account Amount Amount
Impairment to Total
(in thousand pesos)
Accounts Receivable 30,167,126 3,136,293 27,030,833 23.36
Notes Receivable 147,945 41,298 106,647 0.09
Loans Receivable-
Government-Owned or
Controlled Corporations 19,050,045 1,234,768 17,815,278 15.40
Loans Receivable-Local
Government Units 7,705,700 7,803 7,697,897 6.65
Interests Receivable 53,582,853 19,229 53,563,624 46.29
Loans Receivable-Others 11,897,344 2,399,343 9,498,001 8.21
Total 122,551,013 6,838,733 115,712,280 100.00
a. Accounts Receivable
The departments/offices with balances of Accounts Receivable are as

follows:
Allowance
Gross Carrying
for Percent
Department/Office Amount Amount
Impairment to Total
(in thousand pesos)
Finance 12,968,155 2,167,627 10,800,528 39.96
Colleges 5,610,557 247,757 5,362,799 19.84
Health 4,564,004 205,129 4,358,874 16.13
Information and
Communications
Technology 2,988,921 38,542 2,950,378 10.91
Energy 1,644,659 - 1,644,659 6.08
Resources 919,641 210,202 709,438 2.62
Agriculture 504,271 219,577 284,694 1.05
Other Executive Offices 276,193 8,196 267,998 0.99
Presidential
Communications
Operations Office 271,306 3,700 267,606 0.99
Public Works and
Highways 86,314 656 85,658 0.32
Sub-total 29,834,019 3,101,388 26,732,631 98.90
Other Departments/
Offices 333,107 34,905 298,202 1.10
Total 30,167,126 3,136,293 27,030,833 100.00
The Accounts Receivable held by the DOF included claims of BTr

under LBP-ARF for the land acquired by agrarian reform beneficiaries
in accordance with the provisions of R.A. No. 3844, P.D. No. 27, E.O.
No. 228, E.O. No. 229, R.A. No. 6657, and R.A. No. 9700. It also
80
included dues from landowners/farmers/beneficiaries/cooperative
arising from land transfer claim and other loan related transactions, and
portion of the contract price of sold real and other properties acquired
(ROPA) in settlement of ARF funded loans amounting to P171.84
thousand. Breakdown are as follows:
Allowance
Gross Carrying
for
Particulars Amount Amount
Impairment
(in thousand pesos)
Agrarian Reform Receivable 12,952,475 2,158,324 10,794,151
Claims from Landowners, etc. 11,833 9,303 2,530
Contract Receivable – Sold ROPA 172 - 172
Total 12,964,480 2,167,627 10,796,852
b. Notes Receivable
The current portion of Notes Receivable was reported by the following

departments/offices:
Allowance
Gross Carrying
for Percent
Impairment to Total
(in thousand pesos)
Health 102,896 4,573 98,323 92.19
Agriculture 44,891 36,724 8,167 7.66
Colleges 155 - 155 0.14
Education 4 - 4 0.00
Total 147,945 41,298 106,647 100.00
The Notes Receivable reported by the Department of Health (DOH)

pertained to the promissory notes issued by several patients for services
rendered to them by different government hospitals.
The amount attributed to the DA corresponded to the balance of

Philippine Council for Agriculture and Fisheries (PCAF) and the
Philippine Fiber Industry Development Authority (PhilFIDA). The
receivables recorded by PCAF amounting to P37.92 million represents
the balance of Victoria Multi-Purpose Cooperative for sales under
contract of 10,139.93 metric tons of urea fertilizer-commodity grants
provided under the United States Public Law 480 Title I Program which
remained uncollected since 1998. The balance reported by the
PhilFIDA amounting to P6.97 million pertained to the dormant
accounts of Imperial Textile Mills and Atlas Development Corporation
which are subject of request for authority to write off.
c. Loans Receivable-Government-Owned or Controlled

Corporations
The details of this account reported by four departments/offices are

81
shown below.
Allowance
Gross Carrying Percent
for
Department/Office Amount Amount to
Impairment
Total
(in thousand pesos)
Finance 12,410,561 - 12,410,561 69.66
Education 3,159,263 475 3,158,788 17.73
Agriculture 3,348,698 1,234,292 2,114,406 11.87
Agrarian Reform 122,973 - 122,973 0.69
Energy 8,196 - 8,196 0.05
Colleges 355 - 355 0.00
Total 19,050,045 1,234,768 17,815,278 100.00
Loans Receivable accounted by the DOF consisted of due and

demandable loan outlays granted by the BTr to GCs amounting to
P12.41 billion.
The amount reported by DA-OSEC includes funds transferred to

Quedan and Rural Credit Guarantee Corporation (QUEDANCOR) and
Philippine Rice Research Institute amounting to P1 billion and P656.13
million, respectively, to cover the implementation of the Financing
Program for Small Farmers and Fisherfolk using the Self-Reliance
Team Model and other schemes under the Agricultural
Competitiveness Enhancement Fund (ACEF). QUEDANCOR,
however, had been dissolved upon issuance of Memorandum Order No.
13 dated June 28, 2017 by the Office of the President (OP).
d. Loans Receivable-Local Government Units
Among the departments/offices of the NG, only three reported Loans

Receivable-Local Government Units, as follows:
Allowance
Gross Carrying
for Percent
Department/ Office Amount Amount
Impairment to Total
(in thousand pesos)
Finance 7,464,973 - 7,464,973 96.97
Agriculture 240,494 7,803 232,691 3.02
Colleges 233 - 233 0.00
Total 7,705,700 7,803 7,697,897 100.00
The loans recognized by the DOF pertained to loans granted by the

Municipal Development Fund Office (MDFO) to LGUs amounting to
P7.46 billion.
The amount for the DA, as accounted by the OSEC, was composed of
loans granted in the form of 4-wheel tractors, irrigation pumps and
warehouses with a repayment period of 5-10 years. This also includes
82
P31.65 million loans granted under the ACEF.
e. Interests Receivable
Interests Receivable expected to be collected within the next 12 months

from the reporting date is accounted by following departments/offices:
Allowance
for
Department/ Office Amount Amount to Total
Impairment
(in thousand pesos)
Finance 52,736,760 861 52,735,898 98.45
Transportation 734,601 - 734,601 1.37
Colleges 42,089 - 42,089 0.08
Education 27,114 - 27,114 0.05
Energy 7,883 - 7,883 0.01
Other Executive Offices 5,320 971 4,349 0.01
Trade and Industry 3,691 - 3,691 0.01
Agrarian Reform 2,667 - 2,667 0.00
Labor and Employment 19,033 16,708 2,325 0.00
Agriculture 1,994 - 1,994 0.00
Sub-total 53,581,151 18,540 53,562,611 100.00
Other Departments/
Offices 1,702 689 1,013 0.00
Total 53,582,853 19,229 53,563,624 100.00
The amount reported by the DOF consisted of interests recognized by

the BTr on NG advances amounting to P52.15 billion, TOP Foreign
Currency Time Deposits in 1993 of P249.49 million, and investments
in T-Bonds of BSF, Securities Stabilization Fund (SSF) and DBP-Agro
Industrial Technology Transfer Program of P42.99 million. This also
included the interest receivable for LBP-ARF amounting to P10.31
million.
The DOTr-OSEC reported Interests Receivable of P719.24 billion

pertaining to the following:
Amount
Debtor Nature
(in thousand pesos)
Metro Rail Transit Interest charges on late payment
Development of monthly Development Rights
Corporation Payment (DRP) amortization to
Metro Star Express/EDSA MRT
III 683,873
Greenfields Interest charges from unpaid
Development DRP amortization
Corporation 424
Philharbor Ferries and Interest on unpaid instalment
Port Services, Inc. sale of MV 2 34,947
Total 719,243
The Agricultural Credit Policy Council, an attached agency of the DA,
83
also reported P1.99 million collectible from Peoples Credit and Finance
Corporation under Cooperative Banks Agri-Lending Program-
Agriculture and Fishery Financing Program.
f. Dividends Receivable
The Dividends Receivable reported by the BTr in FY 2016 pertained to

parcel of land in San Miguel, Bulacan measuring 15,511,416 sq.m.
which was declared by the BSP as property dividends to the NG. During
FY 2017, this account was reclassified as Investment Property in
compliance with the recommendation of the BTr COA auditor through
Audit Observation Memorandum dated February 27, 2017.
g. Loans Receivable-Others
Loans granted to recipients other than GCs and LGUs were reported by
12 departments/offices, as follows:
Allowance
Gross Carrying
for Percent
Impairment to Total
(in thousand pesos)
Agriculture 7,741,297 418,746 7,322,551 77.10
National Defense 497,412 - 497,412 5.24
Finance 1,612,563 1,340,515 272,048 2.86
Trade and Industry 309,967 111,104 198,863 2.09
Colleges 182,443 5,896 176,547 1.86
Agrarian Reform 155,122 - 155,122 1.63
Labor and Employment 660,213 520,073 140,140 1.48
Science and Technology 88,905 - 88,905 0.94
Social Welfare and
Development 35,387 - 35,387 0.37
Energy 24,628 - 24,628 0.26
Autonomous Region in
Muslim Mindanao 6,044 1,470 4,574 0.05
Total 11,897,344 2,399,343 9,498,001 100.00
Loans recognized by the DA-OSEC are those granted to various

beneficiaries for the implementation of ACEF, Western Visayas “in
life” Program, and CARP, and those loans granted to farmers and
cooperatives in the form of post-harvest equipment, facilities, shallow
tube wells, open surface sources and other farm supplies and
equipment.
6.2. Lease Receivable
The current portion of Lease Receivable consisted of Operating Lease

Receivable and Finance Lease Receivable amounting to P1.20 billion and
P122.48 million, respectively.
84
a. Operating Lease Receivable
Rental income from lease of assets which remained uncollected as at

year-end were accrued by the following departments/offices:
Allowance
Gross Carrying
for Percent
Impairment to Total
(in thousand pesos)
Transportation 944,231 - 944,231 78.71
Agriculture 88,668 - 88,668 7.39
Other Executive Offices 66,287 - 66,287 5.53
Education 40,401 - 40,401 3.37
Colleges 33,270 35 33,235 2.77
Tourism 26,950 1,181 25,769 2.15
Resources 745 - 745 0.06
Science and Technology 308 - 308 0.03
Total 1,200,861 1,216 1,199,645 100.00
The Operating Lease Receivable from the DOTr pertained to the

following lease transactions:
Amount
Debtor Nature
(in thousand pesos)
Bayantel Albay Lease for Public Calling Offices
Telecom System (PCOs) Albay 2,926
Bayantel Camarines Lease for PCOs Camarines
Norte Telecom Norte
System 1,463
Greenfields DRP amortization
Development
Corporation 380
Philharbor Ferries and Charterhire lease of MV 1 and 2
Port Services, Inc. 28,636
Metro Rail Transit Account due to Metro Star
Development Express/EDSA MRT III for
Corporation DRP monthly amortization 910,827
Total 944,231
b. Finance Lease Receivable
On January 27, 2004, the Privatization and Management Office (PMO)

entered into a Deed of Conditional Sale with the Provincial Government
of Abra (PGA). All the remaining assets of Cellophil Resources
Corporation, a transferred asset by NG to Asset Privatization Trust
pursuant to Trust Agreement dated February 27, 1987 were
conditionally sold to PGA for P100.20 million. The PGA had already
paid P29 million from 2005 to 2007. The balance of P71.20 million
remained uncollected as at December 31, 2017.
On April 21, 2016, a contract to sell was executed by PMO in favor of
85
Triplex Enterprises, Incorporated for two parcels of land located in
Parañaque with an area of approximately 13,000 sq. m. The land was
formerly owned by Luzon Aggregates, Incorporated, and was
transferred by NG to PMO for disposition. The sale is worth P268
million with a down payment of P32 million. The balance shall be
payable quarterly in five years with interests of 3.5 percent per annum.
Outstanding Balance as at year-end was P173.39 million.
6.3. Inter-Agency Receivables
The details of this sub-major group of accounts are presented below.

Amount Amount
to Total to Total
pesos) pesos)
Due from National
Government Agencies 23,119,537 3.50 15,383,812 2.50
Due from Government-
Owned or Controlled
Corporations 570,488,182 86.26 558,701,006 90.70
Due from Local Government
Units 67,721,956 10.24 41,869,332 6.80
Total 661,329,674 100.00 615,954,149 100.00
a. Due from National Government Agencies
This account is used to recognize advances/fund transfers to NGAs for

the procurement of goods and services as authorized by law and for the
implementation of various programs/projects under specific contracts
and agreements, and other receivables from NGAs.
This account had been netted against “Due to National Government

Agencies” account to remove the effect of inter-agency transactions for
the NG as a whole. However, some agencies failed to reconcile such
accounts, thereby resulting in residual balance of P23.12 billion for FY
2017, details are as follows:
2016
2017
Account (Restated)
(in thousand pesos)
Due from National Government Agencies 99,377,462 85,397,101
Less: Due to National Government Agencies 76,257,925 70,013,289
Difference 23,119,537 15,383,812
b. Due from Government-Owned or Controlled Corporations
Due from Government-Owned or Controlled Corporations refers to

advances for the purchase of goods/services as authorized by law, fund
transfers to the GCs for implementation of projects, guarantee fees for
NG-guaranteed loans of GFIs/GCs, NG advances for debt service
86
payments on NG-relent or guaranteed loans of GFIs/GCs and other
receivables from GFIs/GCs. Unliquidated/unpaid portion of this
account was reported by the following departments/offices:
Amount Percent
Department/Office
Finance 516,545,628 90.54
Health 7,165,946 1.26
Agriculture 6,363,828 1.12
Interior and Local Government 5,564,982 0.98
Sub-Total 564,670,660 98.98
Total 570,488,182 100.00
Dues recognized by the DOF were composed primarily of receivables

of BTr for the account of the NG. Details are as follows.
Amount
Particulars
(in thousand pesos)
1. Guarantee fee receivables from GOCCs/GFIs 25,184,052
2. NG’s refinancing of BSP advances/payments on
liabilities retained with Central Bank-Board of
Liquidators 275,774,451
3. NG Receivable from BSP on IMF remuneration on
the reserve tranche 764,376
4. Balance of loans outlay released to LBP under the
Agrarian Reform Loans 1,255,528
5. NG advances in behalf of GOCCs/GFIs for their
foreign and domestic obligations (principal, interest
and other charges) 196,578,195
6. NG advances for assumed GOCCs/GFIs guaranteed
obligations 6,865,783
7. Dormant accounts subject to verification and
consequently will be requested for write-off 6,550,055
8. Overdue accounts from Loans Receivable which were
reclassified to Due from GOCCs 2,726,794
9. Balance of DBP’s outstanding obligations to the NG
relative to the Northern Cement Corporation covered
by Deed of Assignment of Rights and Interest
between DBP and PMO dated December 30, 2003
involving the transfer to NG through PMO, of DBP’s
receivables from the Department of Agrarian Reform
(DAR)/LBP arising from DBP’s transfer to DAR of
agricultural lands pursuant to E.O. No. 407 dated June
14, 1990 229,316
10. LBP-ARF Clearing Account with the LBP for ARF
collections 200,710
11. Others 74,332
Total 516,203,590
87
The receivables reported by DSWD are broken down as follows:
Amount
Particulars
(in thousand pesos)
Land Bank of the Philippines 10,746,364
Philippine International Trading Corp. 164,005
Social Housing and Finance Corp. 10,360
Technology and Livelihood Resource Center 23,500
Others 300,825
Total 11,245,054
The amount due from the LBP pertained to funds transferred for the
payment of cash grants to the beneficiaries of the Pantawid Pamilyang
Pilipino Program (4Ps). The balance from Philippine International
Trading Corporation pertained to the unliquidated portion of the funds
transferred during FY 2013 and 2014 for the emergency purchase of
goods and services, and infrastructure projects under the Yolanda
Recovery and Rehabilitation Program. The amount granted to the
Social Housing and Finance Corp. represents the shelter assistance to
148 informal settler families in Cagayan de Oro City who are victims
of the typhoon Sendong in 2011. Receivables from the Technology and
Livelihood Center pertained to the funds transferred for training and
livelihood programs, augmentation supports and assistance.
Other transfers include, among others, the allocation made by the

DSWD Field Offices to the National Food Authority (NFA) for the
purchase of rice as part of the Supplemental Feeding Program in Davao,
and the Mindanao State University-General Santos City and Surallah
National Agricultural School for the Modified Conditional Cash
Transfer Project, and vocational and technical skills training of 3,130
4Ps beneficiaries in North Cotabato under the Sustainable Livelihood
Program.
c. Due from Local Government Units
This account represents balances of funds transferred to LGUs for

purchase of goods/services as authorized by law, fund transfers to the
LGUs for implementation of projects, share from LGUs income and
other receivables. The departments/offices with balances of this
account are the following:
Amount Percent
Department/Office
Agriculture 16,769,315 24.76
Health 5,086,169 7.51
Labor and Employment 2,713,942 4.01
Agrarian Reform 1,394,979 2.06
88
Amount Percent
Department/Office
Autonomous Region in Muslim Mindanao 1,203,124 1.78
Sub-Total 62,025,749 91.59
Total 67,721,956 100.00
Funds transferred by the DA to LGUs are intended for the

implementation of infrastructure and post-harvest facility projects such
as farm-to-market roads, small water impounding projects and repair
and rehabilitation of existing irrigation system. These are also intended
to carry out Bottom-up Budgeting Project, National Livestock Program,
Targeted Actions to Reduce Poverty and Economic Transformation
Program and other projects involving agriculture and fisheries.
Transfers of the DSWD-OSEC to LGUs included the following

balances as at year-end:
Nature Amount
(in thousand pesos)
Fund releases to Payapa at Masaganang Pamayanan
(PAMANA)-Barangay LGU-Kapit-Bisig Laban sa
Kahirapan-Comprehensive and Integrated Delivery of
Social Services (KALAHI-CIDSS) as community grants
to various barangays 114,867
Funds transferred to the Municipality of Guihulngan,
Negros Oriental as augmentation for the Cash for Work
Program for the 1,422 families affected by earthquake in
Region VII 2,565
Funds transferred to the Municipality of La Libertad,
Negros Oriental as augmentation for the Cash for Work
Program for the 1,422 families affected by earthquake in
Region VII 1,002
Funds transferred to the Provincial Government of Aklan,
Antique, Camarines Sur, Oriental Mindoro and Sorsogon
for the implementation of implementation of various
programs and projects i.e. Social Pension for Indigent
Senior Citizens, Supplemental Feeding Program,
Sustainable Livelihood Program, various programs
under the Bottom-Up Budgeting process, Crisis
Intervention Program, shelter assistance and
construction of Day Care Center and Senior Citizens
Center 6
Total 118,440
6.4. Intra-Agency Receivables
Intra-Agency Receivables refer to reciprocal accounts that subsist within

the agency between the Central Office, Staff Bureaus, ROs and OUs.
Account components are as follows:
89
Amount Amount
to Total to Total
pesos) pesos)
Due from Operating Units 9,889,302 100.00 6,739,624 98.58
Due from Other Funds - - 96,805 1.42
Total 9,889,302 100.00 6,836,429 100.00
To eliminate the effect of intra-agency transactions, Intra-Agency

Receivables accounts were netted against Intra-Agency Payables accounts.
After elimination, however, unmatched transactions and balances existed
in the following departments/offices:
Intra-Agency Intra-Agency
Balance
Department/Office Receivables Payables
(in thousand pesos)
Education 4,633,027 148,674 4,484,353
Mindanao 3,386,290 826,900 2,559,390
Agriculture 1,164,881 289,573 875,308
Health 1,121,735 470,024 651,710
Foreign Affairs 1,116,324 564,530 551,794
Public Works and Highways 7,197,346 6,804,909 392,438
Agrarian Reform 648,703 377,406 271,298
National Defense 468,231 210,928 257,303
Environment and Natural Resources 175,927 43,331 132,595
Authority 131,515 36,003 95,512
Sub-Total 20,043,979 9,772,278 10,271,701
Other Departments/Offices 2,001,334 2,383,733 (382,399)
Total 22,045,313 12,156,012 9,889,302
balances of Intra-Agency Receivables as at year-end.
6.5. Other Receivables
Details of this sub-major group of accounts are as follows:

Amount Amount
to Total to Total
pesos) pesos)
Receivables-Disallowances/
Charges 7,658,375 11.49 7,260,325 11.74
Due from Officers and
Employees 1,328,587 1.99 753,328 1.22
Due from Non-Government
Organizations/People’s
Organizations 16,433,034 24.65 9,479,794 15.33
Other Receivables 41,244,165 61.87 44,351,806 71.71
Total 66,664,162 100.00 61,845,253 100.00
90
a. Receivables-Disallowances/Charges
This account refers to disallowances/charges imposed by the auditors

due from public and private entities or individuals which have become
final and executory. As at year-end, the following departments/offices
reported balances, as follows:
Amount Percent
Department/Office
Finance 1,966,874 25.68
Health 358,503 4.68
Agrarian Reform 295,232 3.86
Sub- total 6,863,069 89.62
Total 7,658,375 100.00
b. Due from Officers and Employees
This account includes claims from officers and employees for

overpayment of salaries and other personnel benefits, operating
expenses, cash shortages, losses of assets and other bills.
The following departments/offices reported outstanding claims from

their officers and employees:
Amount Percent
Department/Office
Health 179,216 13.49
Finance 62,452 4.70
Sub-total 1,216,353 91.55
Total 1,328,587 100.00
c. Due from Non-Government Organizations/People’s Organizations
Unliquidated portion of advances granted to Non-Government

Organizations (NGOs)/People’s Organizations (POs) were reported by
91
the following departments/offices:
Amount Percent
Department/Office
Science and Technology 1,295,122 7.88
Education 1,225,909 7.46
Health 140,579 0.86
Sub-total 16,329,831 99.37
Total 16,433,034 100.00
Receivables recognized by DSWD-OSEC include the balance of the

funds transferred to various NGOs in FY 2012 and prior years
amounting to P383.06 million which were funded through
Congressional Initiatives, Congressional Development Funds, and
Priority Development Assistance Fund of various solons. Receivables
also include, among others, the transfers to Associates of the Urban
Poor, Inc. amounting to P39.93 million for the housing assistance to the
beneficiaries of “Integrated People Driven Model Community Project
for the Typhoon Affected Families” in Tacloban City, and the balance
from International Organization for Migration amounting to P77.19
million for the construction of 700 single-detached transitional shelters,
and water, sanitation and hygiene facilities for Zamboanga Crisis-
affected populations, and for developing capacity to train families and
communities in evacuation preparedness.
d. Other Receivables
This account represents receivables from other debtors not falling under
any of the specific receivable accounts. The following
departments/offices reported balances of this account:
Allowance
Gross Carrying
for Percent
Impairment to Total
(in thousand pesos)
The Judiciary 14,908,243 232 14,908,011 36.15
Finance 15,033,775 978,589 14,055,187 34.08
Commission on Audit 2,723,906 - 2,723,906 6.60
Science and Technology 2,407,206 - 2,407,206 5.84
Development
Authority 712,724 - 712,724 1.73
Health 666,380 8,345 658,035 1.60
Agriculture 638,030 13 638,017 1.55
92
Allowance
Gross Carrying
for Percent
Impairment to Total
(in thousand pesos)
National Defense 692,665 72,279 620,385 1.50
Office of the
Ombudsman 562,880 - 562,880 1.36
Sub-total 39,200,955 1,062,530 38,138,425 92.47
Other Departments/
Offices 3,376,171 270,430 3,105,741 7.53
Total 42,577,126 1,332,960 41,244,165 100.00
The balance of The Judiciary is composed primarily of receivables

recognized by SCP amounting to P13.66 billion. This includes, among
others, the unpaid loans of qualified Court employees, receivables from
local banks due to erroneous charging, dues from former employees,
and funds transferred to local banks for the Court’s infrastructure
projects, training programs and expenses of the Halls of Justice.
Other Receivables recognized by the BIR of P10.10 billion pertained to

taxation revenue transactions of different NGAs, revenue regions,
officers and employees, details of which are as follows:
Amount
Particulars
(in thousand pesos)
National Office
1. Receivable funding for the Tax Credit Certificates
(TCCs) and Tax Debit Memos (TDMs) issued by
various BIR offices and DOF One-Stop-Shop to the
taxpayers 9,915,678
2. Dishonored checks for FYs 1987 to 2015 195,046
3. Penalties on Authorized Agent Banks’ violations 2,401
4. Acceptance of dishonored checks as at December 31,
2017 93
5. Outstanding balance of Municipal Treasurers 35,664
designated as Regional Collecting Officers (RCOs)
6. Outstanding balances of collecting officers of various 30,256
NGAs
7. Cash shortages of former RCOs from FYs 1961-1970
who were no longer in service and whose
whereabouts could no longer be located (subject to
completion of documentary requirements for request 6,837
for write-off)
8. Outstanding balances of RCOs on accountable forms 304,413
(documentary stamps, science stamps auxiliary
labels) for the period FYs 1961-1989
9. Outstanding balance of BIR designated Revenue
Attaché/Revenue Representative who are no longer in
the service 1,671
10. Outstanding balance of DFA Finance Officers
designated as collecting agents of the BIR for
collection of internal revenue taxes from Filipinos 6,512
working abroad
11. Outstanding balance of dishonored check of a former
Special Collecting Officer 5
Sub-total 10,498,576
93
Amount
Particulars
(in thousand pesos)
Total Reported by Revenue Regions 424,389
Total 10,922,964
The DOF-PMO reported the following details of Other Receivables

account in the amount of P944.59 million:
Amount
Particulars
(in thousand pesos)
1. Mile Long Complex – operational expenses (e.g.,
management, conservation and maintenance) 1,656
2. Emerald Plaza - telephone/water/electric bill 356
3. Inland Property Ventures, Locator Marketing Corp.,
and Villapando, Carlito - share in common expenses
in the building (i.e. garbage dues, water and electric
bills) 420
4. Defunct Congressional Accounts Liquidation Office
– various accounts 7,225
5. Defunct government corporations - various accounts
from the former Board of Liquidators 934,755
6. Others 175
Total 944,586
7. INVENTORIES
This major group of accounts consists of the following sub-major groups:

Amount Amount
to Total to Total
pesos) pesos)
Inventory Held for Sale 2,473,857 2.75 2,209,588 3.36
Inventory Held for Distribution 40,562,871 45.02 28,697,033 43.58
Inventory Held for Manufacturing 1,112,937 1.24 941,936 1.43
Inventory Held for Consumption 42,367,347 47.03 32,917,173 49.99
Semi-Expendable Machinery and
Equipment 2,208,286 2.45 689,756 1.05
Semi-Expendable Furniture, Fixtures
and Books 1,366,161 1.52 397,621 0.60
Total 90,091,458 100.00 65,853,106 100.00
7.1. Inventory Held for Sale
a. Merchandise Inventory
This account refers to the cost of goods purchased or acquired which

are intended for sale in the ordinary course of business. It includes
supplies and materials, drugs and medicines, agricultural produce,
ammunitions, property and equipment, among others. As at year-end,
the unsold merchandise was reported by the following
94
Amount Percent
Department/Office
Health 1,118,274 45.20
Tourism 1,315 0.05
Education 508 0.02
Authority 343 0.01
Transportation 273 0.01
Total 2,473,857 100.00
Merchandise kept by the DOH pertained to drugs and medicines,

medical, dental, laboratory and other related inventories that are held
for sale by the pharmacy of the different government hospitals.
Inventory reported by the DBM consisted of the merchandise held by

the Procurement Service as at reporting date after deducting loss of
P5.99 million from damaged and expired items.
7.2. Inventory Held for Distribution

Amount Amount
to Total to Total
pesos) pesos)
Food Supplies for Distribution 65,498 0.16 52,443 0.18
Welfare Goods for
Distribution 1,511,654 3.73 1,648,770 5.75
Drugs and Medicines for
Distribution 17,580,758 43.34 12,780,444 44.54
Medical, Dental and
Laboratory Supplies for
Distribution 2,683,223 6.61 2,035,697 7.09
Agricultural and Marine
Supplies for Distribution 4,712,693 11.62 3,124,377 10.89
Agricultural Produce for
Distribution 198,597 0.49 202,209 0.70
Textbooks and Instructional
Materials for Distribution 530,260 1.31 540,779 1.88
Construction Materials for
Distribution 86,759 0.21 74,394 0.26
Property and Equipment for
Distribution 11,077,778 27.31 6,534,023 22.77
Other Supplies and Materials
for Distribution 2,115,650 5.22 1,703,896 5.94
Total 40,562,871 100.00 28,697,033 100.00
95
a. Welfare Goods for Distribution
Welfare Goods for Distribution was reported by the following

Amount Percent
Department/Office
Health 1,244 0.08
Education 11 0.00
Total 1,511,654 100.00
The welfare goods maintained by DSWD represents the food and non-
food supplies for distribution to individuals affected by various
calamities, disasters and ground conflicts. This also represents the
monetized value of donations of P895.89 thousand received prior to the
issuance of COA Circular No. 2014-002 dated April 15, 2014 and
locally purchased inventories of P439.86 million.
b. Drugs and Medicines for Distribution
Drugs and Medicines for Distribution was reported by the following

Amount Percent
Department/Office
Health 17,571,043 99.94
National Defense 720 0.00
Social Welfare and Development 634 0.00
Total 17,580,758 100.00
The amount reported by the DOH refers to drugs and medicines for
distribution to patients, hospitals and health facilities.
c. Medical, Dental and Laboratory Supplies for Distribution
Medical, Dental and Laboratory Supplies for Distribution was reported

by the following departments/offices:
Amount Percent
Department/Office
Health 2,641,361 98.44
Total 2,683,223 100.00
96
The amount reported by the DOH refers to medical, dental and
laboratory supplies for distribution to patients, hospitals and health
facilities.
d. Agricultural and Marine Supplies for Distribution
Agricultural and Marine Supplies for Distribution were reported by the

following departments/offices:
Amount Percent
Department/Office
Total 4,712,693 100.00
e. Agricultural Produce for Distribution
Agricultural Produce for Distribution was reported by the following

Amount Percent
Department/Office
Agrarian Reform 169 0.09
Total 198,597 100.00
f. Textbooks and Instructional Materials for Distribution
Textbooks and Instructional Materials for Distribution was reported by

Amount Percent
Department/Office
Education 509,328 96.05
Health 5,737 1.08
Total 530,260 100.00
g. Construction Materials for Distribution
Construction Materials for Distribution was reported by the following

97
Amount Percent
Department/Office
Public Works and Highways 27 0.03
Total 86,759 100.00
h. Property and Equipment for Distribution
The Property and Equipment for Distribution was reported by the

Amount Percent
Department/Office
Health 1,804,016 16.28
Science and Technology 39,165 0.35
Sub-Total 11,074,818 99.97
Total 11,077,778 100.00
i. Other Supplies and Materials for Distribution
Other Supplies and Materials for Distribution was reported by the

Amount Percent
Department/Office
Health 1,739,154 82.20
Sub-Total 2,112,044 99.83
Total 2,115,650 100.00
98
7.3. Inventory Held for Manufacturing

Amount Amount
to Total to Total
pesos) pesos)
Raw Materials Inventory 507,666 45.61 486,279 51.63
Work-in-Process Inventory 151,686 13.63 148,127 15.73
Finished Goods Inventory 453,585 40.76 307,530 32.64
Total 1,112,937 100.00 941,936 100.00
Only seven departments/offices reported balances of Inventories Held for

Manufacturing, as follows:
Amount Percent
Department/Office
Presidential Communications Operations Office 79,406 7.13
Health 12,209 1.10
Total 1,112,937 100.00
The Government Arsenal of the DND reported Raw Materials Inventory of

P436.86 million, Work-in-Process Inventory of P70.82 million and
Finished Goods Inventory of P419.33 million. The Finished Goods
Inventory consisted of assorted ammunitions manufactured by the Agency
for delivery to the different DND offices.
Manufacturing inventories reported by the Presidential Communications

Operations Office (PCOO) pertains to raw, in-process and/or available for
sale accountable and standard forms, Official Gazettes, Philippine reports,
laws and resolutions, and various books and documents of the National
Printing Office.
7.4. Inventory Held for Consumption
This group of accounts refers to the costs of purchases/acquisitions of

inventory intended for consumption in the regular operations of an agency.
Unused portion of these inventories are reported as follows:
99
Amount Amount
to Total to Total
pesos) pesos)
Office Supplies Inventory 4,473,452 10.56 3,676,782 11.17
Accountable Forms, Plates,
and Stickers Inventory 1,888,547 4.46 1,317,660 4.00
Non-Accountable Forms
Inventory 130,681 0.31 130,914 0.40
Animal/Zoological Supplies
Inventory 29,169 0.07 15,876 0.05
Food Supplies Inventory 569,914 1.35 289,312 0.88
Drugs and Medicines
Inventory 3,153,855 7.44 3,517,630 10.69
Medical, Dental, and
Laboratory Supplies
Inventory 3,823,553 9.02 3,322,034 10.09
Fuel, Oil and Lubricants
Inventory 3,263,143 7.70 1,738,392 5.28
Agricultural and Marine
Supplies Inventory 1,562,791 3.69 1,327,169 4.03
Textbooks and Instructional
Materials Inventory 4,810,436 11.35 4,010,114 12.18
Military, Police, and Traffic
Supplies Inventory 6,450,783 15.23 4,676,577 14.21
Chemical and Filtering
Supplies Inventory 62,059 0.15 23,550 0.07
Construction Materials
Inventory 4,030,057 9.51 3,775,839 11.47
Other Supplies and Materials
Inventory 8,118,906 19.16 5,095,323 15.48
Total 42,367,347 100.00 32,917,173 100.00
Inventories for Consumption were reported by the following

Amount Percent
Department/Office
Health 7,213,408 17.03
Education 5,743,479 13.56
Finance 688,079 1.62
Sub-Total 39,698,054 93.70
Total 42,367,347 100.00
The balance of the DND pertained mostly to the unused supplies reported
by the Philippine Army (PA), Philippine Air Force (PAF) and Philippine
Navy (PN) amounting to P7.45 billion, P3.13 billion and P1.62 billion,
100
respectively. The unconsumed supplies of the PA was composed mainly of
Military, Police and Traffic Supplies such as ammunitions, explosives,
magazines and other firearms accessories acquired.
7.5. Semi-Expendable Machinery and Equipment
This sub-major group of accounts refers to machinery and equipment

purchased/acquired costing less than P15,000.00. It is composed of the
following accounts:

Amount Amount
to Total to Total
pesos) pesos)
Machinery 77,724 3.52 19,259 2.79
Office Equipment 206,535 9.35 108,795 15.77
Information and
Communications
Technology Equipment 407,504 18.45 228,295 33.10
Agricultural and Forestry
Equipment 6,953 0.31 2,885 0.42
Marine and Fishery
Equipment 6,518 0.30 4,450 0.65
Communications Equipment 48,511 2.20 41,559 6.03
Disaster Response and Rescue
Equipment 116,371 5.27 38,157 5.53
Military, Police and Security
Equipment 100,940 4.57 34,148 4.95
Medical Equipment 139,107 6.30 63,757 9.24
Printing Equipment 4,397 0.20 2,210 0.32
Sports Equipment 8,470 0.38 3,763 0.55
Technical and Scientific
Equipment 818,530 37.07 28,450 4.12
Other Machinery and
Equipment 266,725 12.08 114,026 16.53
Total 2,208,286 100.00 689,756 100.00
The drastic increase was due to the adoption of accounting policy

reclassifying all machinery and equipment falling below the capitalization
threshold of P15,000, either currently or previously acquired, to form part
of the inventory.
Semi-Expendable Machinery and Equipment reported by the departments/

offices are as follows:
Amount Percent
Department/Office
Education 1,096,560 49.66
Health 197,337 8.94
Finance 77,191 3.50
101
Amount Percent
Department/Office
Sub-Total 1,990,365 90.13
Total 2,208,286 100.00
7.6. Semi-Expendable Furniture, Fixtures and Books

Amount Amount
to Total to Total
pesos) pesos)
Furniture and Fixtures 1,274,715 93.31 350,964 88.27
Books 91,445 6.69 46,656 11.73
Total 1,366,161 100.00 397,621 100.00
Similarly, the sudden increase of Semi-Expendable Furniture, Fixtures and

Books was due to change in accounting policy reclassifying all furniture,
fixtures and books costing less than P15,000, either currently or previously
acquired, to form part of the inventory.
Semi-Expendable Furniture, Fixtures and Books were reported by the

Amount Percent
Department/Office
Education 771,826 56.50
Finance 67,743 4.96
Health 51,615 3.78
Sub-Total 1,230,820 90.09
Total 1,366,161 100.00
8. OTHER CURRENT ASSETS
This major group of accounts is composed of advances, prepayments and deposits

paid in anticipation of future performance of services, receipt of goods, incurrence
of expenditures or the receipt of other assets.
102
Amount Amount
to Total to Total
pesos) pesos)
Advances 15,408,119 10.21 10,964,891 8.68
Prepayments 71,430,947 47.35 62,379,203 49.36
Deposits 64,013,657 42.43 53,039,288 41.97
Total 150,852,723 100.00 126,383,382 100.00
8.1. Advances

Amount Amount
to Total to Total
pesos) pesos)
Advances for Operating
Expenses 5,287,540 34.32 3,907,225 35.63
Advances for Payroll 1,937,850 12.58 1,830,791 16.70
Advances to Special
Disbursing Officers 7,018,826 45.55 4,062,259 37.05
Advances to Officers and
Employees 1,163,903 7.55 1,164,616 10.62
Total 15,408,119 100.00 10,964,891 100.00
balances of the Advances accounts as at year-end.
a. Advances for Operating Expenses
Unliquidated cash advances granted to accountable officers for

payment of operating expenses of operating/field units and foreign
posts not maintaining complete set of books of accounts are included in
this account. The departments/offices which showed balances of this
account are as follows:
Amount Percent
Department/Office
Education 3,383,427 63.99
Tourism 448,711 8.49
Health 17,867 0.34
Sub-total 5,176,221 97.89
Total 5,287,540 100.00
103
The unliquidated cash advances recorded by the Department of
Education (DepEd) pertained mainly to those granted to School Heads
for use in their regular operating requirements.
b. Advances for Payroll
This account refers to the balance of cash advances granted to special

disbursing officers for payment of salaries, wages, honoraria,
allowances and other personnel benefits. The departments/offices with
balances of this account are as follows:
Amount Percent
Department/Office
Education 595,670 30.74
Justice 64,258 3.32
Health 37,681 1.94
Sub-total 1,885,796 97.31
Total 1,937,850 100.00
c. Advances to Special Disbursing Officers
This account pertains to advances granted to agency’s accountable

officers and employees for special purpose/time-bound undertakings
that were not liquidated as at year-end. This account also includes labor
payroll for projects undertaken by administration.
The departments/offices with balances of this account are as follows:
Amount Percent
Department/Office
Education 1,188,145 16.93
Justice 487,423 6.94
Office of the President 102,861 1.47
Sub-total 6,636,564 94.55
Total 7,018,826 100.00
104
Advances from DWSD to SDOs were intended for the implementation
of various DSWD programs and services such as social pension, cash
for work, livelihood training, Crisis Intervention Program and shelter
assistance. These also pertained to advances granted to Social Welfare
Attachés in other countries for which liquidation reports submitted were
subject to review and evaluation prior to recognition in the books of
accounts.
d. Advances to Officers and Employees
This account refers to the amount advanced to officers and employees

for official travel. The departments/offices with balances of this
Amount Percent
Department/Office
Education 336,865 28.94
Justice 87,023 7.48
Health 35,221 3.03
Sub-total 956,012 82.14
Total 1,163,903 100.00
8.2. Prepayments

Amount Amount
to Total to Total
pesos) pesos)
Advances to Contractors 58,737,858 91.76 49,091,873 92.56
Prepaid Rent 569,456 0.89 632,614 1.19
Prepaid Registration 2,178 0.00 1,962 0.00
Prepaid Interest 2,154,564 3.37 1,336,525 2.52
Prepaid Insurance 1,257,724 1.96 255,190 0.48
Other Prepayments 1,291,877 2.02 1,721,124 3.24
Total 64,013,657 100.00 53,039,288 100.00
a. Advances to Contractors
This account referring to payments advanced to contractors as

authorized by law was reported by the following departments/offices:
105
Amount Percent
Department/Office
Health 5,777,522 9.84
Education 1,045,236 1.78
Sub-total 57,793,725 98.39
Total 58,737,858 100.00
b. Prepaid Rent
This account pertaining to advance rental payments were recognized by

Amount Percent
Department/Office
Authority 53,632 9.42
Finance 26,334 4.62
Sub-total 551,110 96.78
Total 569,456 100.00
Prepaid Rent by the DFA refers to the advance rental payments by

FSPs.
c. Prepaid Registration
This account pertaining to prepayments for registration of government

property was reported by the following departments/offices:
Amount Percent
Department/Office
Environment and Natural Resources 353 16.22
Health 351 16.09
Authority 304 13.95
106
Amount Percent
Department/Office
Interior and Local Government 181 8.33
State Universities and Colleges 108 4.97
Sub-total 2,088 95.83
Other Departments/Offices 90 4.17
Total 2,178 100.00
d. Prepaid Interests
Prepaid Interests were recognized by the following departments/

offices:
Amount Percent
Department/Office
Finance 2,154,000 99.97
Office of the Ombudsman 556 0.03
Total 2,154,564 100.00
The amount for the DOF was recorded in the books of the BTr which
refers to the prepaid interests or discounts on the issuance of T-Bills.
e. Prepaid Insurance
This account representing the unexpired portion of insurance coverage

for government property was recognized by the different
departments/offices, as follows:
Amount Percent
Department/Office
Finance 1,016,315 80.81
Health 52,641 4.19
Office 6,292 0.50
Sub-total 1,202,425 95.60
Total 1,257,724 100.00
107
f. Other Prepayments
Other prepayments not falling under any of the specific prepayment

accounts were reported by the following departments/offices:
Amount Percent
Department/Office
Health 56,753 4.39
Sub-total 1,252,522 96.95
Total 1,291,877 100.00
8.3. Deposits

Amount Amount
Specific Account Percent Percent
to Total to Total
pesos) pesos)
Deposit on Letters of Credit 59,702,943 83.58 50,223,871 80.51
Guaranty Deposits 11,197,549 15.68 12,083,661 19.37
Other Deposits 530,454 0.74 71,671 0.12
Total 71,430,947 100.00 62,379,203 100.00
a. Deposit on Letters of Credit
This account was reported by the following departments/offices:
Amount Percent
Department/Office
Health 14,545,718 24.36
Office of the President 618 0.00
Office 194 0.00
Total 59,702,943 100.00
108
Deposits on letters of credit of P38.72 billion placed by the DND with
AGDBs pertained primarily to the supply and delivery of firearms,
ammunitions, vehicular and communication requirements of the AFP,
including the cost of freight forwarding contracted with foreign
suppliers.
b. Guaranty Deposits
The departments/offices with balances of Guaranty Deposits are as

follows:
Amount Percent
Department/Office
Health 36,401 0.33
Sub-total 11,073,256 98.89
Total 11,197,549 100.00
Guaranty deposits of the DA included the P6.02 billion pesos rendered

for its contribution/augmentation to Agricultural Guarantee Fund Pool
for Rice Self-Sufficiency Program.
c. Other Deposits
Other Deposits was reported by the following departments/offices:
Amount Percent
Department/Office
Finance 47,278 8.91
Congress of the Philippines 3,177 0.60
Health 1,872 0.35
Sub-total 528,823 99.69
Total 530,454 100.00
109
9. INVESTMENTS
The total Investments of the NG is composed of the following sub-groups:

Amount Amount
to Total to Total
pesos) pesos)
Financial Assets-Held to Maturity 4,111,847 0.41 8,671,679 0.78
Financial Assets-Others 194,769,036 19.57 184,096,967 16.64
Investments in GOCCs 243,881,947 24.51 238,523,422 21.56
Sinking Fund 552,442,864 55.51 675,128,850 61.02
Total 995,205,694 100.00 1,106,420,918 100.00
9.1. Financial Assets-Held to Maturity
a. Investments in Treasury Bonds-Local
Investments in Treasury Bonds-Local represents the entire Financial

Assets-Held to Maturity. Only five departments/offices reported this
account, as follows:
Amount Percent
Department/Office
Finance 3,680,032 89.50
Total 4,111,848 100.00
The BTr reported this account which consists of NG investments in T-

Bonds and investments in T-Bonds of the funds managed/administered
by the BTr, details of which are as follows:
Amount
Particulars
(in thousand pesos)
NG-Special Guaranty Fund 126,129
Security Stabilization Fund 2,608,901
Metropolitan Waterworks and Sewerage System-Special
Reserve Fund 233,381
NCCA 711,621
Total 3,680,032
Among the agencies of the OEO, only the Technical Education and
Skills Development Authority (TESDA) and Cooperative Development
Authority (CDA) reported this account with carrying amounts of
P135.31 million or 98.60 percent and P1.92 million or 1.40 percent,
respectively. Those reported by the TESDA were investments under the
Sariling Sikap Project.
110
9.2. Financial Assets-Others

Amount Amount
to Total to Total
pesos) pesos)
Investments in Stocks 152,089,377 78.09 142,652,406 77.49
Investments in Bonds 5,309,956 2.73 5,093,397 2.77
Other Investments 37,369,703 19.19 36,351,165 19.75
Total 194,769,036 100.00 184,096,967 100.00
a. Investments in Stocks
The departments/offices which reported Investments in Stocks are as

follows:
Amount Percent
Department/Office
Finance 151,047,183 99.31
Justice 906,493 0.60
Sub-total 152,076,890 99.99
Total 152,089,377 100.00
Among the agencies under the DOF, the BTr and PMO reported
P150.65 billion or 99.74 percent and P396.16 million or 0.26 percent,
respectively.
The amount reported by the BTr consists of NG subscriptions to the

capital stocks of international financial institutions, as follows:
Amount
Particulars
(in thousand pesos)
Asian Development Bank 2,479,734
ADB Credit Guarantee and Investment Facility 150,582
Asian Infrastructure Investment Bank 5,920,121
International Bank for Reconstruction and Development 1,305,534
International Development Association 732,544
International Finance Corporation 50,877
International Fund for Agricultural Development 10,229
International Monetary Fund 139,972,300
Multilateral Investment Guarantee Agency 29,097
Total 150,651,018
Two agencies under the DOJ reported this account: PCGG with
P906.05 million or 99.95 percent pertaining to surrendered shares of
stocks mostly for privatization from 17 companies, and LRA with
P443.65 thousand or 0.05 percent representing cost of stocks of
111
MERALCO and deposit with the Philippine Long Distance Telephone
Company.
b. Investments in Bonds
Of the total Investments in Bonds of the NG, the BTr reported P4.85
billion or 91.73 percent which pertained to NG investments in NIA
Bonds. The purchase of the NG of a 10-year 8.375 percent NIA Bonds
due 2013 with a face amount of USD97 million was approved by the
BSP Monetary Board, under its Resolution No. 1511 dated October 15,
2003, based on the proposal of the Republic of the Philippines (ROP)
to settle the obligation of NIA arising from taxes paid by the California
Energy (CE) Casecnan Water and Energy Company, Inc. (Casecnan),
pursuant to the Supplemental Agreement to the Amended and Restated
Casecnan Project Agreement between NIA and Casecnan, which
involves the following transactions:
1. Issuance by ROP of 10-year USD97 million Bonds, the

proceeds of which shall be used to purchase NIA bonds;
2. Issuance by NIA of 10-year USD97 million Bonds guaranteed

by the ROP, the proceeds of which shall be used to pay its
obligation to Casecnan for taxes paid by Casecnan for the Multi-
Purpose Project; and
3. Purchase by Casecnan of the ROP Bonds.
The investment in NIA Bonds was already requested for reclassification

to NG advances to NIA given the circumstances surrounding the
issuance of NIA Bonds wherein NG was the investor/buyer, using the
proceeds from RP issued bonds, to allow NIA to settle its obligation to
Casecnan.
c. Other Investments
Other Investments were reported by the following departments/offices:
Amount Percent
Department/Office
Finance 6,997,534 18.73
Commission on Audit 1,798 0.00
Sub-total 37,365,425 99.99
Total 37,369,703 100.00
112
The OWWA reported P17.73 billion or 99.09 percent of the total for
DOLE.
The UPS reported P11.24 billion or 99.51 percent of the total Other
Investments of SUCs. This was reported by the following campuses:
Amount
Campus
(in thousand pesos)
UP System Administration 9,968,028
UP Diliman 108,068
UP Philippine General Hospital 74
UP Los Baños 1,165,294
Total 11,241,465
9.3. Investments in GOCCs
Of the total Investments in GOCCs of P243.88 billion, almost 100 percent

was reported by the BTr, details of which are as follows:
Amount
Particulars
(in thousand pesos)
NG equity in stock GOCCs 114,637,987
NG equity in non-stock GOCCs 119,899,000
NG equity in non-stock GOCCs which were already defunct,
converted to other NGAs and non-GOCCs 9,318,804
NG equity in unidentified GOCCs/Accounts 26,156
Total 243,881,946
9.4. Sinking Fund
The Sinking Fund account of P552.44 billion was entirely reported by the
BTr which includes NG-issued and NG-guaranteed LBP and NFA
securities administered/managed by the BTr, details of which are as
follows:
Amount
Particulars
(in thousand pesos)
BSF-Securities (Bonds) 475,618,495
BSF-Securities (RP) 76,824,369
Total 552,442,864
The BSF of the NG-issued bonds includes investments in government

securities, thus, the government is both a debtor and creditor of government
securities held by BSF with face amount of P524.76 billion, broken down
as follows:
Amount
Particulars
(in thousand pesos)
T-Bills 1,237,273
T-Bonds 459,655,867
113
Amount
Particulars
(in thousand pesos)
ROP Bonds 63,868,795
Total 524,761,935
10. RECEIVABLES
Receivables of the NG is composed of the following sub-groups of accounts:

Amount Amount
to Total to Total
pesos) pesos)
Loans and Receivable Accounts 188,376,881 92.58 200,276,492 100.00
Lease Receivables 15,104,285 7.42 - 0.00
Total 203,481,166 100.00 200,276,492 100.00
10.1. Loans and Receivable Accounts
This sub-major group of accounts consists of the following:
Allowance
Gross Carrying
for Percent
Impairment to Total
(in thousand pesos)
Notes Receivable 137,012,596 - 137,012,596 72.73
Loans Receivable-
Government-Owned or
Controlled Corporations 51,097,960 - 51,097,960 27.13
Loans Receivable-Local
Government Units 7,763 - 7,763 0.00
Interests Receivable 246,859 - 246,859 0.13
Loans Receivable-Others 11,816 113 11,702 0.01
Total 188,376,994 113 188,376,881 100.00
a. Notes Receivable
The total Notes Receivable was entirely disclosed by the BTr. It refers
to a promissory note issued by the CB-BOL in favor of the Treasurer of
the Philippines in substitution of the frozen/retained deposits in the CB-
BOL. Issuance of a new promissory note in support of this balance had
been requested from the CB-BOL.
b. Loans Receivable-Government-Owned or Controlled

Corporations
The Loans Receivable-Government-Owned or Controlled Corporations

reported solely by the BTr pertained to loans outlays to GCs (cash and
constructive cash). Accordingly, when the GCs are unable to pay their
114
loans, the NG advances payment to the creditors in behalf of GCs
debiting the account Due from Government-Owned or Controlled
Corporations for the total amount paid (principal plus interest and other
charges) and crediting Loans Receivable-Government-Owned or
Controlled Corporations for the principal portion only.
c. Loans Receivable-Local Government Units
Loans Receivable-Local Government Units was reported solely by the

DOF, specifically the MDFO.
d. Interests Receivable
The Interests Receivable of P242.60 million or 98.27 percent pertained

to MDFO under the DOF.
e. Loans Receivable-Others
Only SUCs and DND reported balances of Loan Receivable-Others,

amounting to P11.70 million or 99.94 percent and P7 thousand or 0.06
Among the SUCs, only four reported this account. These are the Bicol
University with P6.83 million or 58.42 percent, Batanes State
University with P2.50 million or 21.41 percent, Visayas State
University with P2.03 million or 17.39 percent, and Catanduanes State
University with P325.12 thousand or 2.78 percent.
10.2. Lease Receivables
a. Operating Lease Receivable
This account was reported solely by the PMO which refers to the unpaid
rental for the lease of Leyte Park Hotel.
b. Finance Lease Receivable
This account, reported solely by the PMO, consists of the following:
Amount
Accounts
(in thousand pesos)
G. Holdings, Inc. 241,702
Philnico Mining and Industrial Corporation 14,665,896
Social Housing Finance Corporation 45,322
Triplex Enterprises, Incorporated 122,116
Total 15,075,035
115
11. INVESTMENT PROPERTY
This sub-major group of accounts refers to investments in land and buildings,

composed of the following:
Gross Accumulated Carrying

Percent
Account Amount Depreciation Amount
to Total
(in thousand pesos)
Investment Property, Land 2,025,680 - 2,025,680 93.81
Investment Property, Buildings 263,267 152,329 110,938 5.14
Construction in Progress-Investment
Property, Buildings 22,758 - 22,758 1.05
Total 2,311,705 152,329 2,159,376 100.00
The following departments/offices reported Investment Property, as follows:
Amount Percent
Department/Office
Finance 2,025,680 93.81
Total 2,159,376 100.00
The BTr declared Investment Property, Land of P2.03 billion representing 100
percent of the total reported by the DOF pertaining to the value of reclaimed land
transferred by the Philippine National Construction Corporation (PNCC). The
portion of the land equivalent to P1.52 billion was part of APT recovery from the
PNCC account while the portion of the land equivalent to P510 million was DOF’s
proportionate right which was assigned to BTr.
12. PROPERTY, PLANT AND EQUIPMENT
This major group of accounts comprises 13 sub-major groups, as follows:
Accumulated
Sub-Major Group of Impairment Percent
Amount Depreciation Amount
Accounts Losses to Total
(in thousand pesos)
Land 345,036,381 - 31 345,036,350 13.82
Land Improvements 23,102,970 4,339,921 84,320 18,678,729 0.75
Infrastructure Assets 1,414,992,189 810,393,199 6,375 604,592,615 24.22
Buildings and Other
Structures 273,587,918 80,794,076 32,238 192,761,604 7.72
Machinery and
Equipment 229,045,568 113,950,250 37,171 115,058,147 4.61
Transportation
Equipment 100,654,604 43,318,427 4,850 57,331,327 2.30
Furniture, Fixtures and
Books 18,081,384 7,923,395 3,472 10,154,516 0.41
Leased Assets 2,578,309 346,400 - 2,231,909 0.09
116
Accumulated
Sub-Major Group of Impairment Percent
Amount Depreciation Amount
Accounts Losses to Total
(in thousand pesos)
Leased Assets
Improvements 511,495 257,186 - 254,309 0.01
Heritage Assets 929,858 128,793 - 801,065 0.03
Service Concession
Tangible Assets 18,601,367 5,355,811 - 13,245,556 0.53
Other Property, Plant
and Equipment 6,997,549 3,148,724 683 3,848,141 0.15
Construction in Progress 1,132,288,251 - - 1,132,288,251 45.36
Total 3,566,407,843 1,069,956,183 169,140 2,496,282,518 100.00
Schedule 15, Volume II of this Report shows the list of agencies with balances of
Property, Plant and Equipment.
12.1. Land
The following departments/offices were entitled to ownership/rights to

various land property:
Amount Percent
Department/Office
Finance 54,986,041 15.94
Education 14,271,206 4.14
Sub-total 338,916,172 98.23
Total 345,036,350 100.00
The value of the Land owned by DND includes a total land area of
235,497,452 sq.m. owned by PAF, of which 231,483,205 sq.m. valued at
P54.54 billion was recognized in the books of accounts. The locations and
status of the remaining land area of 4,014,247.00 sq.m. are as follows:
Area
Location Remarks
(in sq.m.)
Puerto Princesa City 585,413 For transfer in the name of the ROP
Puerto Princesa City 231,657 For acquisition
Pasay City 479,317 Covered by Land Swapping Agreement
Calarian, Zamboanga 1,169 For annotation of Deed of Donation
Lipa City, Batangas 2,671,655 Expropriated
Lipa City, Batangas 37,064 For acquisition
Calaca, Batangas Under DENR Case No. 6907 dated May
7,972 1997
Total 4,014,247
117
12.2. Land Improvements
The total Land Improvements is composed of the following accounts:
Accumulated
Impairment Percent
Losses to Total
(in thousand pesos)
Land Improvements,
Aquaculture
Structures 582,253 240,445 14,081 327,727 1.76
Land Improvements,
Reforestation
Projects 10,065,067 - 69,395 9,995,672 53.51
Other Land
Improvements 12,455,650 4,099,476 844 8,355,330 44.73
Total 23,102,970 4,339,921 84,320 18,678,729 100.00
a. Land Improvements, Aquaculture Structures
This account was mainly reported by the DA, specifically by the Bureau
of Fisheries and Aquatic Resources (BFAR) and OSEC with carrying
amounts of P131.28 million and P112.97 million, respectively. BFAR
disclosed that the account relates to fishery and marine structures such
as drainage systems and incidental structures made to fishponds.
b. Land Improvements, Reforestation Projects
Only two departments/offices reported this account, as follows:
Amount Percent
Department/Office
Environment and Natural Resources 9,992,498 99.97
Total 9,995,672 100.00
The amount reported by the Department of Environment and Natural

Resources (DENR) refers to those acquired through, among others,
National Greening Program, Fisheries Sector Program, Seedling
Production Project and various foreign-assisted projects. These
comprise costs incurred for perimeter fences, garden soil supplies,
ground leveling and other related costs, such as project management
and supervision costs, travelling expenses, and labor and materials.
c. Other Land Improvements
Amount Percent
Department/Office
118
Amount Percent
Department/Office
Health 180,627 2.16
Tourism 129,980 1.56
Sub-Total 7,941,240 95.04
Total 8,355,330 100.00
Other land improvements pertained to costs of improvements such as

parking lots, landscape, walkways, sidewalks, fences, and the like.
12.3. Infrastructure Assets
Accumulated
Gross Accumulated Carrying Percent
Impairment
Account Amount Depreciation Amount to
Losses
Total
(in thousand pesos)
Road Networks 1,191,310,199 673,634,398 28 517,675,773 85.62
Flood Control Systems 202,752,863 127,965,989 - 74,786,874 12.37
Sewer Systems 70,135 12,622 - 57,513 0.01
Water Supply Systems 1,144,757 115,360 - 1,029,397 0.17
Power Supply Systems 1,199,241 534,424 51 664,765 0.11
Communications
Networks 805,523 571,244 - 234,279 0.04
Seaport Systems 6,259,256 5,051,652 - 1,207,604 0.20
Airport Systems 5,349,246 2,034,116 - 3,315,130 0.55
Parks, Plazas and
Monuments 1,110,511 322,591 - 787,920 0.13
Other Infrastructure
Assets 4,990,459 150,803 6,296 4,833,360 0.80
Total 1,414,992,190 810,393,199 6,375 604,592,615 100.00
a. Road Networks
The departments/offices with constructed road networks are the

following:
Amount Percent
Department/Office
Metropolitan Manila Development Authority 1,180,955 0.23
Sub-Total 517,634,693 99.99
119
Amount Percent
Department/Office
Total 517,675,773 100.00
The amount reported by the DPWH includes projects of the OSEC

which were started since FYs 2013-2015 and completed during the
year.
b. Flood Control Systems
The departments/offices with Flood Control Systems account are the

following:
Amount Percent
Department/Office
Metropolitan Manila Development Authority 2,484,785 3.32
Sub-Total 74,777,544 99.99
Total 74,786,874 100.00
The amount reported by the DPWH includes projects which were

started in FY 2013 and completed in FY 2017. This resulted in an
increase of P31.12 billion or 75.82 percent from P41.04 billion in FY
2016.
The flood control systems installed by Metro Metropolitan Manila

Development Authority (MMDA) for dredging, riprapping and
drainage improvements in Metro Manila include costs of
design/build/rehabilitation/upgrading of pumping stations located in
the following flood districts:
Amount
Location
(in thousand pesos)
East of Manila Flood District 143,529
South of Manila Flood District 425,000
West of Manila Flood District 373,228
North of Manila Flood District 480,468
Upgrading of Taguig Pumping Station 164,564
Upgrading of Hagonoy Pumping Station 202,177
Reinforced Concrete Box Culvert Mojica-Don Bosco St.,
Makati City 172,017
Estero De Uli-Uli at San Miguel, Manila 99,975
Upgrading of Pumping Stations at Central Post Office and
Jones Bridge Underpass 29,988
Various Locations 686,686
Total 2,777,631
120
c. Sewer Systems
This account was reported by four departments/offices only namely,

DOH – P48.48 million, SUCS – P8.90 million, DPWH – P128.60
thousand and DND – P8.19 thousand.
d. Water Supply Systems
This account pertained to water source facilities, irrigation canals and

laterals, waterways, water utilities systems and other water supply
facilities acquired either for public use or for income generation. The
departments/offices which acquired water supply systems are as
follows:
Amount Percent
Department/Office
Health 26,188 2.54
Sub-total 1,017,336 98.83
Total 1,029,397 100.00
e. Power Supply Systems
The departments/offices which reported balances of this account are as

follows:
Amount Percent
Department/Office
Health 149,060 22.42
Justice 22,744 3.42
Sub-total 659,027 99.14
Total 664,765 100.00
The power supply systems of SUCs were installed in 71 tertiary schools
121
led by the UPS, Batangas State University, Eulogio "Amang"
Rodriguez Institute of Science and Technology, Western Mindanao
State University, and Mindanao State University System.
f. Communications Networks
Amount Percent
Department/Office
Metropolitan Manila Development Authority 6,500 2.77
Health 4,370 1.87
Education 2 0.00
Total 234,279 100.00
The National Telecommunication Commission and OSEC of DICT

reported P122.68 million and P32.64 million, net of P30.64 million and
P797.55 thousand accumulated depreciation, respectively.
The DOTr-OSEC reported P59.51 million, net of P535.61 million

accumulated depreciation. This represents Municipal Telephone
Projects originally acquired at P185.93 million in FY 1993, P128.64
million in FY 1992, and P280.56 million in FY 1991 per IRP No. 2010-
10-331. These completed projects are to be transferred to the DICT.
g. Seaport Systems
Amount Percent
Department/Office
Total 1,207,604 100.00
The DOTr-OSEC and the Philippine Coast Guard (PCG) reported

P1.11 billion and P68.93 million, respectively. The seaport systems
acquired by the OSEC refer to various construction projects held
completely during the year which include, among others, the costs of
lighthouse signalling equipment, installation service fees and training
expenses charged against Maritime Safety Improvement Project - Phase
II. The amount reported by the PCG refers to the cost of 588 completed
lighthouses nationwide (structures only).
122
h. Airport Systems
This account refers to landing and take-off area for aircraft, passengers’
arrival and departure areas, facilities for aircraft maintenance, and other
airport facilities such as airport runways and taxiways, radio beacon,
aprons, and the like, for public use or for income generating purposes.
As at December 31, 2017, the DOTr and DND reported carrying

amount of P2.75 billion and P562.35 million, respectively. The amount
reported by the DND pertained to infrastructure assets held by the PAF
and GHQ-AFP.
i. Parks, Plazas and Monuments
Six departments/offices disclosed balances of this account, as follows:
Amount Percent
Department/Office
Tourism 17,148 2.18
Total 787,920 100.00
Among the OEOs, only the Pasig River Rehabilitation Center and
National Historical Commission of the Philippines (NHCP) reported
this account of P672.29 million or 85.32 percent and P65.19 million or
8.27 percent, respectively, of the total for the NG.
j. Other Infrastructure Assets
The departments/offices with balances of public infrastructures which

cannot be classified under any of the specific types of public
infrastructures are as follows:
Amount Percent
Department/Office
Health 47,567 0.98
Sub-total 4,802,036 99.35
Total 4,833,360 100.00
123
12.4. Buildings and Other Structures
Components of this sub-major group of accounts are as follows:
Accumulated
Impairment
Account Amount Depreciation Amount to Total
Losses
(in thousand pesos)
Buildings 88,096,175 30,893,414 10,803 57,191,958 29.67
School Buildings 131,598,892 32,693,985 3,481 98,901,426 51.31
Hospitals and
Health Centers 21,983,107 5,806,297 - 16,176,811 8.39
Markets 46,233 13,113 - 33,119 0.02
Slaughterhouses 2,140 1,507 - 633 0.00
Hostels and
Dormitories 1,268,115 394,880 839 872,396 0.45
Other Structures 30,593,255 10,990,881 17,114 19,585,261 10.16
Total 273,587,917 80,794,077 32,237 192,761,604 100.00
a. Buildings
Below are the departments/offices with their corresponding balances of

this account at year-end:
Amount Percent
Department/Office
Finance 4,998,896 8.74
Education 4,280,367 7.48
Sub-total 43,037,367 75.25
Total 57,191,958 100.00
The PA, GHQ-AFP and PAF reported P3.37 billion, P2.20 billion, and
P519.94 million, respectively, or a total of P6.09 billion representing
87.55 percent of the total for DND.
b. School Buildings
Nine departments/offices reported School Buildings account, as

follows:
Amount Percent
Department/Office
Education 72,150,944 72.95
124
Amount Percent
Department/Office
Total 98,901,426 100.00
c. Hospitals and Health Centers
The departments/offices which disclosed balances of this account are

as follows:
Amount Percent
Department/Office
Health 13,502,555 83.47
Justice 27,878 0.17
Total 16,176,811 100.00
d. Markets
Six departments/offices reported balances of this account, as follows:
Amount Percent
Department/Office
Total 33,119 100.00
e. Slaughterhouses
The DA, DepEd and SUCs disclosed balances of this account at P316
thousand, P259 thousand and P58 thousand, respectively.
f. Hostels and Dormitories

as follows:
125
Amount Percent
Department/Office
Health 287 0.03
Total 872,396 100.00
The balance for SUCs pertained to accounts of 34 SUCs. For the

Department of Science and Technology (DOST), the Philippine
Science High School System and the OSEC reported P218.20 million
and P1.96 million, respectively.
g. Other Structures
Shown below are the departments/offices with balances of this account:
Amount Percent
Department/Office
Education 1,396,526 7.13
Health 616,896 3.15
Sub-total 18,131,840 92.58
Total 19,585,261 100.00
The GHQ-AFP, PAF, PN, and PA reported P1.61 billion, P1.01 billion,
P919.45 million, P821.08 million, respectively, or a total of P4.37
billion representing 89.46 percent of the total for DND.
12.5. Machinery and Equipment
126
Accumulated
Impairment
Losses
Total
(in thousand pesos)
Machinery 4,231,398 1,937,630 189 2,293,578 1.99
Office Equipment 16,406,539 8,934,705 3,597 7,468,237 6.49
Information and
Communications
Technology Equipment 56,042,196 28,588,289 27,651 27,426,256 23.84
Agricultural and Forestry
Equipment 1,991,831 758,025 23 1,233,783 1.07
Marine and Fishery
Equipment 236,009 75,878 28 160,103 0.14
Airport Equipment 201,878 79,423 - 122,456 0.11
Communication Equipment 20,736,448 11,114,494 731 9,621,223 8.36
Construction and Heavy
Equipment 9,446,809 5,279,230 - 4,167,578 3.62
Disaster Response and
Rescue Equipment 9,886,097 5,837,838 - 4,048,259 3.52
Military, Police and
Security Equipment 27,118,762 13,101,042 - 14,017,720 12.18
Medical Equipment 30,769,477 12,358,093 2,110 18,409,274 16.00
Printing Equipment 123,549 70,038 - 53,512 0.05
Sports Equipment 375,282 147,120 64 228,098 0.20
Technical and Scientific
Equipment 31,850,290 12,677,624 1,126 19,171,540 16.66
Other Machinery and
Equipment 19,629,003 12,990,821 1,651 6,636,531 5.77
Total 229,045,568 113,950,250 37,170 115,058,147 100.00
a. Machinery
Balances of this account were reported by the following departments/

offices:
Amount Percent
Department/Office
Finance 260,013 11.34
Office 53,899 2.35
Sub-total 2,154,977 93.96
Total 2,293,578 100.00
The top five SUCs which reported P416.92 million or 71.50 percent of
the total for SUCs are the UPS, Northern Iloilo State University ,
Technological University of the Philippines System (TUPS), Bataan
Peninsula State University and Capiz State University with P328.02
million, P27.87 million, P25.85 million, P21.31 million and P13.88
million, respectively.
127
b. Office Equipment

as follows:
Amount Percent
Department/Office
Education 1,041,266 13.94
Health 586,166 7.85
Finance 194,300 2.60
Sub-total 5,970,019 79.94
Total 7,468,237 100.00
Among the 114 SUCs, the top five for this account are: UPS, Marikina
Polytechnic College, Negros Oriental State University, Isabela State
University, and Mindanao State University System with P383.91
million, P63.91 million, P57.94 million, P56.94 million and P45.31
million, respectively, or a total of P608 million representing 35.26
percent.
c. Information and Communications Technology Equipment

as follows:
Amount Percent
Department/Office
Education 10,264,996 37.43
Finance 936,284 3.41
Justice 893,607 3.26
Health 865,190 3.15
Sub-total 21,893,435 79.83
Total 27,426,256 100.00
Of the DepEd’s balance, the OSEC reported P10.25 billion or 99.89

percent.
128
d. Agricultural and Forestry Equipment
The following departments/offices reported balances of this account, as

follows:
Amount Percent
Department/Office
Justice 7,711 0.63
Health 50 0.00
Total 1,233,783 100.00
For the balance of DA, OSEC, PhilFIDA, Philippine Center for

Postharvest Development and Mechanization and BFAR reported
P833.03 million or 91.88 percent, P36.23 million or 4.00 percent,
P18.88 million or 2.08 percent, and P18.56 million or 2.05 percent,
respectively.
e. Marine and Fishery Equipment
This account was reported by only four departments/offices, as follows:
Amount Percent
Department/Office
Education 271 0.17
Total 160,103 100.00
The amount for the DA was reported entirely by the BFAR which
includes scuba diving equipment, motor pumps, and incubation tanks.
f. Airport Equipment

as follows:
Amount Percent
Department/Office
Total 122,456 100.00
129
As reported by the DOTr-OSEC, this account included two units airport
rescue firefighting vehicle, two units hold baggage X-ray inspection
system, one unit cabin baggage X-ray inspection system, and three units
walk-through metal detector which were funded under Japan
International Cooperation Agency Grant Aid Program for the
rehabilitation and recovery of Tacloban airport from Typhoon Yolanda.
g. Communication Equipment
Amount Percent
Department/Office
Information and Communications Technology 1,170,658 12.17
Office 208,255 2.16
Health 112,434 1.17
Sub-total 9,031,161 93.87
Total 9,621,223 100.00
The GHQ-AFP, PA and PN reported balances of P1.95 billion, P1.76

billion and P1.36 billion, or a total of P5.07 billion or 90.05 percent of
the total reported by the DND.
h. Construction and Heavy Equipment

as follows:
Amount Percent
Department/Office
Office 5,635 0.14
Sub-total 4,161,887 99.86
Total 4,167,578 100.00
130
The amount reported by the DPWH pertained to the costs of various
construction equipment used for the implementation of various
infrastructure projects.
i. Disaster Response and Rescue Equipment
The total balance of this account was reported by the following

Amount Percent
Department/Office
Health 52,177 1.29
Sub-total 4,020,045 99.30
Total 4,048,259 100.00
The bulk of this equipment was reported by the BFP at P3.66 billion
representing 90.44 percent of the total for the NG. From the FY 2016
balance of BFP, there was an increase of P298 million representing
costs of various PPEs purchased through the Procurement Service, and
receipt of the 3rd batch of donation from Japan Grant.
j. Military, Police and Security Equipment
The departments/offices shown below had balances of this account as

at year-end:
Amount Percent
Department/Office
Justice 123,101 0.88
Finance 11,905 0.08
Health 7,799 0.06
Sub-total 14,003,476 99.90
Total 14,017,720 100.00
131
The GHQ-AFP, PA, PN and PAF disclosed P4.38 billion, P3.26 billion,
P1.17 billion, and P223.49 million, respectively, or a total of P9.03
billion representing 98.55 percent of the total for DND.
The PNP disclosed P3.98 billion representing 95.34 percent of the

amount reported by the DILG. Likewise, the Bureau of Jail
Management and Penology (BJMP) and the Philippine Public Safety
College (PPSC) reported P187.79 million and P6.36 million,
respectively.
k. Medical Equipment

as follows:
Amount Percent
Department/Office
Health 13,501,766 73.34
Justice 15,968 0.09
Sub-total 18,370,031 99.79
Total 18,409,274 100.00
For the DOH, the OSEC and the Commission on Population reported
P13.50 billion or 99.99 percent and P1.27 million or 0.01 percent,
respectively.
l. Printing Equipment
Shown below are the departments/offices which disclosed balances of

this account:
Amount Percent
Department/Office
Office 7,593 14.19
132
Amount Percent
Department/Office
Agriculture 841 1.57
Sub-total 52,011 97.20
Total 53,512 100.00
The University of Southeastern Philippines, Leyte Normal University,

Isabela State University and Samar State University disclosed balances
of P4.98 million, P2.56 million, P2.16 million, and P1.45 million,
respectively, or a total of P11.15 million or 59.20 percent for the SUCs.
Under the PCOO, the Bureau of Communication Services and the NPO
reported P4.91 million and P2.69 million, respectively.
m. Sports Equipment
The departments/offices which showed balances of this account are as

follows:
Amount Percent
Department/Office
Health 3,009 1.32
Sub-total 220,794 96.80
Total 228,098 100.00
The top five SUCs which reported balances of this account are: UPS,
Isabela State University, Cagayan State University, Mountain Province
State Polytechnic College and Sultan Kudarat State University with
P10.81 million, P4.70 million, P4.49 million, P3.72 million, and P2.50
million, respectively, or a total of P26.22 million representing 29.69
percent of the total for SUCs.
The PA reported P59.88 million or 90.98 percent of the total DND.
n. Technical and Scientific Equipment
Balances of this account were reported by the following departments/

offices:
133
Amount Percent
Department/Office
Education 3,751,001 19.57
Energy 446,501 2.33
Sub-total 18,138,789 94.61
Total 19,171,540 100.00
The UPS, Eastern Samar State University, University of Science and

Technology of Southern Philippines - Cagayan de Oro, Rizal
Technological University and Visayas State University disclosed
P969.47 million, P237.76 million, P198.07 million, P179.75 million,
and P131.44 million, respectively, or a total of P1.72 billion or 41.09
percent of the total for SUCs.
The OSEC, National Museum (NM) and Philippine High School for the
Arts reported P3.68 billion or 98.16 percent, P65.63 million or 1.75
percent, and P3.52 million or 0.09 percent, respectively, for the DepEd.
o. Other Machinery and Equipment
This account refers to other equipment not otherwise classified under

the specific equipment accounts, the total balance of which was
reported by the following departments/offices:
Amount Percent
Department/Office
Health 559,420 8.43
Finance 475,819 7.17
Sub-total 5,617,759 84.65
Total 6,636,531 100.00
The UPS, Don Honorio Ventura Technological State University, Nueva

Vizcaya State University, Eulogio "Amang " Rodriguez Institute of
Science and Technology and West Visayas State University reported
134
P369.03 million, P128.27 million, P52.72 million, P46.60 million and
P44.45 million, respectively, or a total of P641.07 million or 35.48
percent of the total for SUCS.
12.6. Transportation Equipment
Accumulated
Impairment
Losses
Total
(in thousand pesos)
Motor Vehicles 33,129,422 19,374,399 1,660 13,753,364 23.99
Aircrafts and
Aircrafts Ground
Equipment 42,769,032 11,079,755 - 31,689,276 55.27
Watercrafts 24,375,663 12,713,450 3,190 11,659,023 20.34
Other
Transportation
Equipment 380,486 150,823 - 229,664 0.40
Total 100,654,603 43,318,427 4,850 57,331,327 100.00
a. Motor Vehicles

as follows:
Amount Percent
Department/Office
Health 507,381 3.69
Sub-total 11,452,461 83.27
Total 13,753,364 100.00
The PNP disclosed P3.46 billion or 88.91 percent of the total for DILG.
The OSEC and BJMP also reported P204.25 million or 5.24 percent and
P101.70 million or 2.61 percent, respectively.
The PN, GHQ-AFP, PA, and PAF reported P1.03 billion, P833.54
million, P395.45 million and P181.30 million, respectively, or a total of
P2.44 billion representing 94.66 percent of the total for the DND.
135
b. Aircrafts and Aircrafts Ground Equipment
Shown below are the balances of this account reported by six

Amount Percent
Department/Office
Total 31,689,276 100.00
In the DND, the GHQ-AFP, PN and PAF disclosed P28.03 billion,

P1.63 billion and P1.49 billion, respectively, or a total of P31.16 billion
representing 98.32 percent of the total Aircrafts and Aircrafts Ground
Equipment of the NG. The amount for DOTr was solely reported by the
PCG.
c. Watercrafts

as follows:
Amount Percent
Department/Office
Health 6,096 0.05
Sub-total 11,653,607 99.95
Total 11,659,023 100.00
The PCG reported solely the whole amount for DOTr which refers to
search and rescue vessels, small crafts, rubber boats, aluminum boats,
etc. The PN and the GHQ-AFP primarily reported the balance for the
DND with P2.39 billion and P2.29 billion, respectively.
d. Other Transportation Equipment

as follows:
136
Amount Percent
Department/Office
Authority 671 0.29
Sub-total 227,527 99.07
Total 229,664 100.00
Under the DILG, only the PNP and PPSC reported balances of this
account with P122.10 million or 89.63 percent and P14.13 million or
10.37 percent, respectively.
12.7. Furniture, Fixtures and Books
The total Furniture, Fixtures and Books is composed of the following

accounts:
Accumulated
Impairment
Losses
Total
(in thousand pesos)
Furniture and
Fixtures 15,343,362 6,212,604 1,917 9,128,840 89.90
Books 2,738,022 1,710,791 1,555 1,025,676 10.10
Total 18,081,384 7,923,395 3,472 10,154,516 100.00
a. Furniture and Fixtures
The total of this account was reported by the following departments/

offices:
Amount Percent
Department/Office
Education 4,410,052 48.31
Finance 313,576 3.44
Health 231,667 2.54
137
Amount Percent
Department/Office
Sub-total 8,051,074 88.19
Total 9,128,840 100.00
The OSEC reported P4.38 billion or 99.38 percent of the total for
DepEd.
b. Books
Amount Percent
Department/Office
Education 215,375 21.00
Health 10,461 1.02
Finance 6,388 0.62
Sub-total 1,008,289 98.30
Total 1,025,676 100.00
The top five SUCs which reported P236.02 million or 38.70 percent of
the total for SUCs are the UPS, Negros Oriental State University,
Cagayan State University, Batangas State University and Bohol Island
State University with P146.86 million, P29.29 million, P21.12 million,
P19.79 million and P18.96 million, respectively.
12.8. Leased Assets
Leased Assets is a sub-major group of accounts used in the books of the

lessee under a finance lease to recognize the value of an asset being leased.
This sub-major group of accounts as reported in the books of the agencies
concerned consist of the following accounts:

Amount Depreciation Amount Percent
Account
to Total
(in thousand pesos)
Leased Assets, Land 805,934 - 805,934 36.11
Leased Assets, Buildings and Other
Structures 1,141,466 255,918 885,548 39.68
Leased Assets, Machinery and
Equipment 613,321 86,389 526,932 23.61
Leased Assets, Transportation
Equipment 9,671 1,750 7,921 0.35
138
Account
to Total
(in thousand pesos)
Other Leased Assets 7,917 2,343 5,574 0.25
Total 2,578,309 346,400 2,231,909 100.00
The DOF books showed a total of P942.60 million for Leased Assets.
Particularly, the BIR reported Leased Assets, Land of P299.85 million and
Leased Assets, Buildings and Other Structures of P642.23 million, a total
of P942.07 million or 99.94 percent of total Leased Asset of the DOF.
12.9. Leased Assets Improvements
Leased Assets Improvements is a sub-major group of accounts used to

recognize the cost of improvements and alterations made on assets under
operating lease which are used for government operations or for
commercial and/or income generating purposes. These sub-major groups
of accounts as reported in the books of the agencies concerned consist of
the following accounts:

Account
to Total
(in thousand pesos)
Leased Assets Improvements, Land 23,184 9,905 13,279 5.22
Leased Assets Improvements,
Buildings 456,579 231,707 224,872 88.43
Other Leased Assets Improvements 31,733 15,575 16,158 6.35
Total 511,496 257,187 254,309 100.00
The top departments/offices that reported Leased Assets Improvements are

DFA for P106.21 million or 41.76 percent, DTI for P29.51 million or 11.60,
and DA for P27.12 million, or 10.66 percent.
12.10. Heritage Assets
This sub-major group of PPE is used to record buildings such as museums,

old churches, cathedrals and mosques no longer used for worship, works of
arts and other archeological specimens, such as monuments and sculptures
held and preserved by the government for their cultural and historical
significance. This is accounted under the following accounts:

Percent
to Total
(in thousand pesos)
Historical Buildings 280,138 473 279,665 34.91
Works of Arts and Archeological
Specimens 483,520 2,740 480,780 60.02
Other Heritage Assets 166,200 125,580 40,620 5.07
Total 929,858 128,793 801,065 100.00
139
a. Historical Buildings
The department/offices which disclosed balances of this account are as

follows:
Amount Percent
Department/Office
Total 279,665 100.00
Among the OEOs, only the NHCP and NCCA reported this asset
account with P253.92 million or 93.89 percent and P16.53 million or
b. Works of Arts and Archeological Specimens

as follows:
Amount Percent
Department/Office
Education 287,275 59.75
Tourism 37,027 7.70
Finance 2,992 0.62
Foreign Affairs 148 0.03
Health 86 0.02
Sub-total 480,737 99.99
Total 480,780 100.00
The NM reported the entire amount of Works of Arts and Archeological

Specimens for DepEd.
c. Other Heritage Assets
The following departments/offices recognized Other Heritage Assets in

their respective books of accounts:
Amount Percent
Department/Office
Total 40,620 100.00
140
Among the agencies of the DND, the PAF reported the whole amount
for the department. This includes environmental conservation areas and
nature reserves, natural landmarks of historical interest, areas of land
based on or concerned with events in history, and track of lands
declared as public property by the NG with a view to its preservation
and development for purposes of recreation and culture.
12.11. Service Concession-Tangible Assets
This sub-major group of accounts consists of Other Service Concession

Assets of P13.25 billion, net of Accumulated Depreciation of P5.36 billion.
The entire amount, reported by DepEd, pertained to the completed sub-
projects under Public-Private Partnership (PPP) for school infrastructure
projects.
12.12. Other Property, Plant and Equipment
Details of this sub-major group of accounts are as follows:
Accumulated
Impairment
Losses
Total
(in thousand pesos)
Work/Zoo Animals 220,558 10,202 - 210,356 5.47
Other Property, Plant
and Equipment 6,776,991 3,138,523 683 3,637,785 94.53
Total 6,997,549 3,148,725 683 3,848,141 100.00
a. Work/Zoo Animals
Amount Percent
Department/Office
Education 971 0.46
Congress of the Philippines 54 0.03
Total 210,356 100.00
The PCG reported the whole amount for the DOTr while PNP reported
the whole amount for DILG.
b. Other Property, Plant and Equipment
141
Amount Percent
Department/Office
Health 494,329 13.59
Sub-total 3,202,012 88.02
Total 3,637,785 100.00
Among the 114 SUCs, the top five to this account are: Philippine
Merchant Marine Academy, Technological University of the
Philippines System, UPS, Jose Rizal Memorial State University, and
Laguna State Polytechnic University with P252.61 million, P61.58
million, P58.49 million, P49.54 million and P46.52 million,
respectively, or a total of P468.73 million representing 51.63 percent of
the total reported by SUCs.
12.13. Construction in Progress
Construction in Progress (CIP) represents the ongoing projects undertaken

by various government agencies which include the contract cost and the
related expenses. The CIP account will be reclassified to the appropriate
asset account upon completion of the project. The components of this
Amount Percent
Account
Land Improvements 18,793,783 1.66
Infrastructure Assets 1,023,813,674 90.42
Buildings and Other Structures 89,657,747 7.92
Leased Assets 1,439 0.00
Leased Assets Improvements 21,608 0.00
Total 1,132,288,251 100.00
a. Construction in Progress-Land Improvements
The departments/offices with balances of Construction in Progress-

Land Improvements are as follows:
Amount Percent
Department/Office
142
Amount Percent
Department/Office
Tourism 21,101 0.11
Health 6,346 0.03
Sub-total 18,776,108 99.91
Total 18,793,783 100.00
Of the total Construction in Progress-Land Improvement of DENR,

almost 100 percent pertained the OSEC.
b. Construction in Progress-Infrastructure Assets
The departments/offices with balances of Construction in Progress-

Infrastructure Assets are as follows:
Amount Percent
Department/Office
Agrarian Reform 3,624,651 0.35
Health 440,369 0.04
Sub-total 1,022,911,350 99.91
Total 1,023,813,674 100.00
The various ongoing infrastructure projects of DPWH under this

account was entirely reported by the OSEC.
c. Construction in Progress-Leased Assets
Among the departments/offices of the NG, only the DepEd-OSEC

reported balance of this account.
d. Construction in Progress-Leased Assets Improvements
This account was reported by three departments, as follows:
143
Amount Percent
Department/Office
Trade and Industry 564 2.61
Total 21,608 100.00
Among the agencies of NEDA, the Philippine Statistics Authority and

Tariff Commission reported P10.57 million or 54.01 and P9 million or
13. BIOLOGICAL ASSETS
This major group of accounts is divided into two sub-major groups, as follows:
Accumulated
Gross Carrying
Impairment Percent
Sub-Major Group of Accounts Amount Amount
Losses to Total
(in thousand pesos)
Bearer Biological Assets 552,805 959 551,846 37.33
Consumable Biological Assets 926,426 9 926,417 62.67
Total 1,479,231 968 1,478,263 100.00
13.1. Bearer Biological Assets
Accumulated
Gross Carrying
Impairment Percent
Losses to Total
(in thousand pesos)
Breeding Stocks 342,586 163 342,423 62.05
Livestock 89,294 14 89,280 16.18
Trees, Plants and Crops 107,944 782 107,162 19.42
Aquaculture 9,599 - 9,599 1.74
Other Bearer Biological Assets 3,382 - 3,382 0.61
Total 552,805 959 551,846 100.00
The DA disclosed a total balance of P374.90 million, of which OSEC,

Philippine Carabao Center (PCC), and BFAR reported P290.78 million,
P74.27 million and P9.85 million, respectively.
13.2. Consumable Biological Assets
144
Accumulated
Impairment
Account Amount Amount to Total
Losses
(in thousand pesos)
Livestock Held for
Consumption/Sale/
Distribution 890,452 9 890,443 96.12
Trees, Plants and Crops Held
for Consumption/Sale/
Distribution 27,654 - 27,654 2.99
Agricultural Produce Held for
Consumption/Sale/
Distribution 1,790 - 1,790 0.19
Aquaculture for Consumption/
Sale/Distribution 6,401 - 6,401 0.69
Other Consumable Biological
Assets 129 - 129 0.01
Total 926,426 9 926,417 100.00
Only two agencies under the DA, namely: OSEC and PCC reported
respectively. The amount reported by the OSEC includes purchases of
animals and crops for dispersal to LGUs beneficiaries and other
program/project implementation requiring distribution of biological assets.
14. INTANGIBLE ASSETS
This major group of accounts comprised of the following sub-major groups of

accounts:
Accumulated
Gross Accumulated Impairment Carrying Percent
Sub-Major Group of Amount Amortization Losses Amount to
Accounts
Total
(in thousand pesos)
Intangible Assets 5,977,522 1,750,319 15,877 4,211,326 92.89
Service Concession-
Intangible Assets 40 10 - 30 0.00
Development in Progress 322,373 - - 322,373 7.11
Total 6,299,935 1,750,329 15,877 4,533,729 100.00
14.1. Intangible Assets
Accumulated
Impairment
Account Amount Amortization Amount to
Losses
(in thousand pesos) Total
Patents/Copyrights 92,489 - - 92,489 2.19

Computer Software 4,831,971 1,672,041 15,877 3,144,052 74.66
Websites 2,119 512 - 1,607 0.04
145
Accumulated
Impairment
Account Amount Amortization Amount to
Losses
(in thousand pesos) Total
Other Intangible Assets 1,050,943 77,766 - 973,177 23.11

Total 5,977,522 1,750,319 15,877 4,211,326 100.00
a. Patents/Copyrights
Only three departments/offices reported Patents/Copyrights, as

follows:
Amount Percent
Department/Office
Total 92,489 100.00
Among the attached agencies of the DOST, Metals Industry Research

and Development Center solely reported Patents/Copyrights which
pertained to the development of prototypes.
For the DepEd, the National Council for Children’s Television (NCCT)
and OSEC reported P7.80 million and P6.79 million, respectively. The
amount reported by the NCCT represents the full payment to CBN Asia,
Inc. of the pilot plus 12 episodes of the television program for the
children entitled “OYAYI”.
b. Computer Software

follows:
Amount Percent
Department/Office
Finance 557,414 17.73
Sub-total 2,695,080 85.72
Total 3,144,052 100.00
Of the balance for DOF, the BIR reported P420.27 million or 75.40
146
percent pertaining to developed, contracted and purchased software and
systems.
c. Websites
Only four departments/offices reported Websites, as follows:
Amount Percent
Department/Office
Finance 1,308 81.40
Health 50 3.11
Total 1,607 100.00
Among the attached agencies of the DOF, the Securities and Exchange
Commission (SEC) reported solely the balance of Websites.
d. Other Intangible Assets
At year-end, the departments/offices which reported balances of this

Amount Percent
Department/Office
Health 115 0.01
Total 973,177 100.00
The balance of Other Intangible Assets of DENR which was reported

entirely by National Mapping and Resource Information Authority
pertained to the cost of airborne Interferometric Synthetic Aperture
Radar data for the production of nationwide Digital Elevation Model
and Ortho-Radar Imagery.
14.2. Development in Progress
This sub-major group of accounts consists of the following accounts:
Amount Percent
Account
Patents/Copyrights 47,395 14.70
Computer Software 254,879 79.06
Other Intangible Assets 20,100 6.24
Total 322,374 100.00
147
This sub-major group of accounts was reported by the following
Amount Percent
Department/Office
Finance 106,487 33.03
Tourism 2,360 0.73
Health 1,680 0.52
Total 322,373 100.00
The amount reported by the DOF pertained to BTr and SEC in the amount
respectively.
15. OTHER NON-CURRENT ASSETS
This major group of accounts reported by the NG consists of the following sub-
major groups of accounts:

Amount Amount
to Total to Total
pesos) pesos)
Prepayments 2,491,950 2.14 1,376,343 1.22
Deposits 11,549,664 9.92 11,277,888 9.99
Other Assets 102,408,255 87.94 100,194,489 88.79
Total 116,449,869 100.00 112,848,720 100.00
15.1. Prepayments
The total Prepayments of the NG of P2.49 billion is broken down as

follows:

Amount Amount
to Total to Total
pesos) pesos)
Advances to Contractors 576,571 23.14 544,067 39.53
Prepaid Rent 30,118 1.21 29,021 2.11
Prepaid Registration 35 0.00 187 0.01
Prepaid Insurance 9,797 0.39 7,155 0.52
Other Prepayments 1,875,429 75.26 795,913 57.83
Total 2,491,950 100.00 1,376,343 100.00
148
a. Advances to Contractors
Amount Percent
Department/Office
Finance 51,825 8.99
Sub-total 571,975 99.20
Total 576,571 100.00
For the DND, the PA, GHQ-AFP, PN and Philippine Military Academy
reported P88.97 million or 46.70 percent, P85.82 million or 45.05
percent, P10.31 million or 5.41 percent, and P5.40 million or 2.83
Among the 114 SUCs, only 13 reported balances of this account led by
the Eulogio "Amang" Rodriguez Institute of Science and Technology,
Carlos C. Hilado Memorial State College, Romblon State University,
Siquijor State College and Marinduque State College which reported
P32 million or 29.93 percent, P22.81 million or 21.34 percent, P13.34
million or 12.48 percent, P10.60 million or 9.91 percent, and P9.86
million or 9.23 percent, respectively.
Of the balance for OEO, P96.89 million or 95.80 percent pertained to

the cost of the Housing and Land Use Regulatory Board-Central Office
building.
b. Prepaid Rent
This account was reported by only nine departments/offices, as follows:
Amount Percent
Department/Office
Office of the Vice-President 1,997 6.63
Commission on Human Rights 225 0.75
149
Amount Percent
Department/Office
Justice 83 0.28
Total 30,118 100.00
For DTI, only the IPO and Construction Industry Authority of the
Philippines (CIAP) have reported balances of P14.55 million or 98.38
percent and P240 thousand or 1.62 percent, respectively.
c. Prepaid Registration
Among the departments/offices of the NG, only three reported balances

of this account, as follows:
Amount Percent
Department/Office
Total 35 100.00
The total Prepaid Registration of DTI was reported solely by the CIAP.
d. Prepaid Insurance
At year-end, the departments/offices which reported balances of this

Amount Percent
Department/Office
Authority 142 1.45
Budget and Management 62 0.64
Commission on Human Rights 15 0.15
Total 9,797 100.00
The balance for the DSWD was reported entirely by the OSEC while
the AFP-Health Service Command accounted the whole amount for the
DND.
e. Other Prepayments
150
follows:
Amount Percent
Department/Office
Finance 25,521 1.36
The Judiciary 88 0.00
Sub-total 1,875,386 100.00
Total 1,875,429 100.00
The PN and GHQ-AFP reported P916.85 million and P173.71 million

or a total of P1.09 billion or 99.54 percent for the DND.
15.2. Deposits
This sub-major group of accounts includes the following:

Amount Amount
to Total to Total
pesos) pesos)
Deposit on Letters of Credit 6,312,403 54.65 8,171,241 72.45
Guaranty Deposits 5,214,495 45.15 3,031,964 26.89
Other Deposits 22,766 0.20 74,683 0.66
Total 11,549,664 100.00 11,277,888 100.00
a. Deposit on Letters of Credit
The departments/offices which reported Deposit on Letters of Credit

are as follows:
Amount Percent
Department/Office
Total 6,312,403 100.00
The GHQ-AFP reported P4.14 billion or 80.88 percent on account

Deposit on Letters of Credit representing deposits with AGDBs for the
purchase of firearms, ammunitions, vehicular and communication
requirements of the AFP contracted with foreign suppliers and the cost
of freight forwarding.
151
b. Guaranty Deposits
This account represents deposits made by the NGAs for suppliers to

secure or guarantee performance of services or delivery of supplies
contracted and/or the deposits with AGDBs to secure or guaranty the
compliance with the terms of agreement.

follows:
Amount Percent
Department/Office
Finance 22,253 0.43
Sub-Total 5,199,062 99.70
Total 5,214,495 100.00
The GHQ-AFP reported Guaranty Deposits of P4.61 billion or 99.99

percent which represents deposits to secure or guarantee the compliance
of certain requirements for the delivery of contracted services and/or
logistical needs of the AFP.
c. Other Deposits
The departments/offices which reported Other Deposits are as follows:
Amount Percent
Department/Office
Office of the Ombudsman 1,535 6.74
Finance 1,126 4.95
Sub-Total 22,189 97.47
Total 22,766 100.00
152
The total Other Deposits of DND was reported solely by AFP-
Commissary and Exchange Service (CES). The BFAR reported solely
the balance for the DA.
15.3. Other Assets
This sub-major group of accounts includes the following:
Accumulated
Gross Carrying
Impairment Percent
Losses to Total
(in thousand pesos)
Acquired Assets 67,133,501 1,029,000 66,104,501 64.55
Foreclosed Property/Assets 8,525 - 8,525 0.01
Forfeited Property/Assets 127,523 - 127,523 0.12
Confiscated Property/Assets 607,951 - 607,951 0.59
Abandoned/Surrendered
Property/Assets 14,818,594 - 14,818,594 14.47
Other Assets 20,847,056 105,896 20,741,160 20.25
Total 103,543,150 1,134,896 102,408,254 100.00
a. Acquired Assets
The DOF-BTr disclosed P66.04 billion or 99.90 percent of the total

Acquired Assets of the NG, details are as follows:
Amount
Particulars
(in thousand pesos)
1. Part of the transferred assets under Proclamation No. 50
wherein disposition and sale are being handled by PMO
and National Power Corporation (NPC), which were
reclassified from Other PPE account. These assets are
not restated in their realizable value since it is the PMO
and NPC which have direct knowledge of the assets. BTr
had already requested the PMO for updated listings of
the remaining assets for reconciliation with NG’s books 56,226,108
2. Part of the transferred assets from DBP, PNB and
Philippine Guarantee and Investment Corporation in the
form of financial assets 4,629,764
3. NG holdings in the capital stock of Philippine Air Lines
(PAL) pursuant to Administrative Order (A.O.) No. 242
dated October 21, 1991 and Proclamation No. 50 dated
December 8, 1986 1,050,000
4. Equity in the PNCC transferred by GFIs to NG 1,262,561
5. ROPAs transferred by Al-Amanah Islamic Investment
Bank of the Philippines to NG in exchange for a
corresponding reduction in NG deposits 350,958
6. Real and other property obtained and transferred by the
CB-BOL to the ROP through the BTr as partial
settlement of the liability of CB-BOL to the NG 3,404,266
7. Value of real property known as the Boracay Mansion
per COA’s appraisal as of March 14, 2008 which was
ordered forfeited in favor of the government by the
Sandiganbayan in its decision dated September 12, 2007 142,918
8. Nominal value of P1.00 of National Development
Company (NDC)’s shares of stocks in FILSYN which
153
Amount
Particulars
(in thousand pesos)
was transferred to the NG pursuant to Settlement
Agreement dated December 30, 2003 between NDC and
NG/PMO
Total 67,066,576
Less: Accumulated Impairment Losses pertaining to NG
holdings in the capital stock of PAL (1,029,000)
Net Amount 66,037,576
b. Foreclosed Property/Assets
Of the total NG’s Foreclosed Property/Assets, the BTr and DAR-OSEC

reported P8.15 million or 95.55 percent and P379.50 thousand or 4.45
c. Forfeited Property/Assets
The total Forfeited Property/Assets pertained to the following property

forfeited by the BIR as payment of tax debts:
Amount
Particulars
(in thousand pesos)
1. Land 110,976
2. Other Structures 75
3. Office Equipment 5,401
4. Other Property, Plant and Equipment 14
5. Equity instruments 11,056
Total 127,523
d. Confiscated Property/Assets
As at year-end, the confiscated property/assets for which ownership has

been finally decided in favor of the government are reported by the
Amount Percent
Department/Office
Finance 236,103 38.83
Justice 137,501 22.62
Total 607,951 100.00
The BOC reported the whole amount for DOF. The OSEC reported the
whole amount for DENR which includes the value of
confiscated/seized forest products, conveyance tools, compliments and
equipment decided by court to be in favor of the government.
The balance for DOJ pertained to the jewelry collections that were
154
confiscated/surrendered to PCGG. The amount of P137,500,701.81
used in recognizing these assets in the books of PCGG was based on
Sotheby’s appraisal in March 2003.
e. Abandoned/Surrendered Property/Assets
This account represents the abandoned or surrendered property or assets

for which ownership has been finally decided in favor of the following
Amount Percent
Department/Office
Justice 14,818,350 100.00
Education 236 0.00
Other Departments 8 0.00
Total 14,818,594 100.00
The total amount for DOJ represents Abandoned/Surrendered

Property/Assets of PCGG, the details are as follows:
Amount
Particulars
(in thousand pesos)
Land 14,535,046
Land Improvements 12,411
Buildings 26,536
Office Equipment 234,841
Furniture and Fixtures 9,516
Total 14,818,350
f. Other Assets
The departments/offices with balances of Other Assets account are as

follows:
Amount Percent
Department/Office
Finance 8,753,395 42.20
Health 1,338,335 6.45
Justice 529,390 2.55
Sub-total 18,970,585 91.46
Total 20,741,160 100.00
The BTr disclosed P3.99 billion or 45.57 percent of the DOF’s Other Assets
155
consisting of the following:
Amount
Particulars
(in thousand pesos)
1. SMPC shares owned by the NDC which were
transferred to the NG to settle NDC’s obligations
pursuant to MOA dated December 18, 2015 amongst
DOF, BTr, PMO and NDC 3,930,363
2. Other Bonds 54,994
3. Appraised value as of November 10, 2005 of diamonds
in the Treasury vault deposited by various government
agencies which were escheated in favor of the ROP per
Court Order dated May 5, 1997 2,143
4. Obsolete Fixed Assets, LBP-ARF 1,392
Total 3,988,893
The DA-OSEC reported P1.71 billion or 96.10 percent which consists

of obsolete and unserviceable assets awaiting final disposition as well
as those assets still serviceable but are no longer being used.
Out of the total Other Assets for DND, the PAF reported P1.32 billion
or 79.86 percent.
16. FINANCIAL LIABILITIES
Financial Liabilities is composed of the following sub-major groups of accounts:

Amount Amount
to Total to Total
pesos) pesos)
Payables 299,249,374 30.31 279,130,440 31.64
Bills/Bonds/Loans Payable 687,971,355 69.69 603,094,922 68.36
Total 987,220,729 100.00 882,225,362 100.00
Financial Liabilities as of the end of the year.
16.1. Payables

Amount Amount
to Total to Total
pesos) pesos)
Accounts Payable 102,734,841 34.33 95,672,364 34.28
Due to Officers and
Employees 14,278,950 4.77 13,899,125 4.98
Notes Payable 84,546,704 28.25 84,535,252 30.29
Interest Payable 82,690,530 27.63 79,725,643 28.56
Operating Lease Payable 46,346 0.02 91,511 0.03
156
Amount Amount
to Total to Total
pesos) pesos)
Finance Lease Payable 449,669 0.15 185,890 0.06
Awards and Rewards Payable 1,316,203 0.44 1,316,215 0.47
Tax Refunds Payable 13,186,131 4.41 3,704,440 1.33
Total 299,249,374 100.00 279,130,440 100.00
a. Accounts Payable
This account represents unpaid obligations arising from the normal

course of trade and business operation. The departments/offices which
reported balances of this account are as follows:
Amount Percent
Department/Office
Finance 10,770,129 10.48
Health 10,404,314 10.13
Education 7,823,038 7.62
Sub-Total 83,479,751 81.26
Total 102,734,841 100.00
The OSEC reported P17.95 billion or 99.99 percent of the total for the
DPWH.
Among the SUCs, the UPS topped the list with P8.06 billion
representing 7.84 percent of the total Accounts Payable of the NG.
The BOC and BTr disclosed P5.41 billion or 50.24 percent and P3.22
billion and 29.91 percent, respectively, of the total of P10.77 billion
reported by DOF.
DOH.
b. Due to Officers and Employees
This account represents unpaid claims of officers and employees for

salaries, benefits and other emoluments including authorized
reimbursements. The departments/offices reported balances of this
account as follows:
157
Amount Percent
Department/Office
Education 4,374,663 30.64
Health 1,033,919 7.24
Finance 894,640 6.27
Justice 244,870 1.71
Sub-Total 13,036,915 91.30
Total 14,278,950 100.00
The OSEC reported P4.37 billion or 99.92 percent of the total for
DepEd.
The PA and PN reported P1.37 billion and P1.06 billion or 49.89

percent and 38.85 percent, respectively, of the total for DND.
The National Headquarters of the PNP reported balance of P1.57 billion

or 73.94 percent of the total for DILG.
c. Notes Payable
Only the DOF and SUCs reported balances of this account as follows:
Amount Percent
Department/Office
Finance 84,546,544 100.00
Total 84,546,704 100.00
The total for the DOF was reported solely by the BTr, which represents
promissory notes issued to BSP, IMF, International Bank for
Reconstruction and Development (IBRD), ADB and Multilateral
Investment Guarantee Agency (MIGA) for payment of subscription to
the capital stock of IMF, IBRD, ADB and MIGA.
Among the SUCs, the Nueva Ecija University of Science and

Technology reported Notes Payable of P160.45 thousand.
d. Interest Payable
Only three departments/offices reported balances of this account as

follows:
158
Amount Percent
Department/Office
Finance 82,689,934 100.00
Total 82,690,530 100.00
The amount reported by the DOF pertained to accrued interest on the

re-issuance of Treasury Bonds and outstanding NG debt of the BTr.
e. Operating Lease Payable
The National Printing Office of PCOO reported solely the Operating

Lease Payable of P46.35 million. This pertained to accrued expenses
on the lease of machinery from private printers used for specialized
forms.
f. Finance Lease Payable
This account, which has counterpart leased asset account(s), is used to

recognize a liability arising from a finance lease contract.
Seven departments/offices reported balances as follows:
Amount Percent
Department/Office
Health 298,058 66.28
Finance 79,854 17.76
Total 449,668 100.00
The DOH-OSEC reported entirely the total of P298.06 million

representing liability for leased equipment.
The DOF, specifically the BIR, reported P79.85 million or 17.76

percent of the total Finance Lease Payable of the NG. This pertained to
the finance lease contracts of the Bureau with its lessors: LBP Leasing
Corporation, and Philippine Reclamation Authority (PRA).
The LTO reported the entire account for the DOTr. This represented the
current liability of LTO-NCR relative to a Lease-Purchase Agreement
for the acquisition of the Regional Office building payable in 5 years
per Multi-Year Obligational Authority No. A-13-002 issued by the
DBM on November 8, 2013.
159
g. Awards and Rewards Payable
This account is used to recognize awards granted for civic or

professional achievement and rewards to informers for the receipt of
reliable information leading to successful arrest/capture of fugitives,
seizure/confiscation of smuggled goods, or collection/recovery of
unpaid taxes/surcharges/ fines/penalties.
Among the departments/offices, only the DOF reported a balance for

this account; the BOC with P1.32 billion or 99.91 percent and the BIR
with P1.18 million or 0.09 percent.
h. Tax Refunds Payables

follows:
Amount Percent
Department/Office
Finance 13,142,730 99.67
Health 8,335 0.06
Sub-Total 13,184,265 99.99
Total 13,186,131 100.00
The BOC reported P12.92 billion or 98.31 percent of the total for DOF,
which composed mainly of payables covered by TCCs in
acknowledgement of approved tax credits.
The SCP reported solely the balance for The Judiciary, P46.35 thousand
of which pertained to the forwarded balance from the Jurisconsult.
16.2. Bills/Bonds/Loans Payable

Amount Amount
to Total to Total
pesos) pesos)
Treasury Bills Payable 314,369,300 45.70 287,936,300 47.74
Bonds Payable-Domestic 313,776,788 45.61 228,719,661 37.92
Bonds Payable-Foreign - - 26,008,732 4.31
Loans Payable-Domestic 906,414 0.13 963,547 0.16
Loans Payable-Foreign 58,918,853 8.56 59,466,682 9.86
Total 687,971,355 100.00 603,094,922 100.00
160
a. Treasury Bills Payable
This account is used to recognize issuances/flotations of T-Bills to

government securities eligible dealers, GFIs/GOCCs, LGUs, tax
exempt institutions and other entities through auction, over the counter
or tap method. Under the DOF, the BTr reported solely the total
Treasury Bills Payable of the NG in the amount of P314.37 billion.
b. Bonds Payable-Domestic
This account pertains to issuances/flotations of peso-denominated

bonds. Among the departments/offices, only the DOF and SUCs
reported balances of this account, as follows:
Amount Percent
Department/Office
Finance 313,775,721 100.00
Total 313,776,787 100.00
Under the DOF, the BTr reported entirely the P313.78 billion or almost
100 percent of the total Bonds Payable-Domestic of the NG. The
remaining balance was reported by the Bohol Island State University
with P1.06 million and Mindanao State University System with P2.20
thousand.
c. Loans Payable-Domestic
Five departments/offices reported balances of this account, as follows:
Amount Percent
Department/Office
Finance 792,499 87.43
Autonomous Region in Muslim Mindanao (8) 0.00
Total 906,414 100.00
The BTr reported the total for DOF which pertained to DBP and PNB’s
obligations assumed by the NG of P442.49 million and P350 million,
respectively.
Among the SUCs, 12 disclosed balances of this account. The

Polytechnic University of the Philippines (PUP) topped the list with
P19.54 million or 33.83 percent of the total for the SUCs which
pertained to the loan from the GSIS for the purchase of the Condotel-
Hostel located in Manila.
The balance reported by the MMDA consisted of loans from DBP
161
which were originally intended for the conversion of Makati Hotel into
MMDA building.
d. Loans Payable-Foreign
This account was reported solely by the DOF, specifically the BTr. The
creditors/lending institutions include the ADB, Bank of Austria,
Belgian Loan, Deutsche Bank, French Loan, IBRD, Instituto Credito
Official, IDA, International Fund for Agricultural Development, Japan
Bank for International Cooperation, Japan Export Import Bank,
Kreditanstalt Fur Wiederaufbau, Organization of Petroleum Exporting
Countries, United States Agency for International Development, US
Investing Housing Aid, and US Public Law 480.
17. INTER-AGENCY PAYABLES
17.1. Inter-Agency Payables
This sub-major group of accounts pertains to payables that subsist between

NGAs, LGUs, and GOCCs. It is composed of the following accounts:

Amount Amount
to Total to Total
pesos) pesos)
Due to BIR 8,320,059 13.11 7,349,490 11.89
Due to GSIS 8,535,343 13.45 6,864,943 11.11
Due to Pag-IBIG 510,388 0.80 429,751 0.70
Due to PhilHealth 1,216,026 1.92 1,113,604 1.80
Due to GOCCs 36,003,213 56.73 38,014,926 61.51
Due to LGUs 8,874,570 13.98 8,029,520 12.99
Total 63,459,599 100.00 61,802,234 100.00
balances of Inter-Agency Payables as of the end of the year.
a. Due to BIR
This account represents taxes withheld from salaries of officers and

employees, and payments to suppliers and service providers which are
yet to be remitted by the following departments/offices:
Amount Percent
Department/Office
Education 1,021,092 12.27
Health 828,527 9.96
162
Amount Percent
Department/Office
Sub-Total 6,998,498 84.12
Total 8,320,059 100.00
Both the OSECs of DPWH and DepEd reported unremitted taxes

withheld of P2.99 billion or 35.89 percent and P1 billion or 12.06
percent, respectively, of the total Due to BIR.
b. Due to GSIS
This account represents the employees’ premium payments and other

payables for remittance to the GSIS. The following departments/offices
reported balances as follows:
Amount Percent
Department/Office
Education 7,407,754 86.79
Health 53,547 0.63
Finance 29,459 0.35
Sub-Total 8,337,333 97.68
Total 8,535,343 100.00
For the DepEd, the OSEC reported P7.41 billion or almost 100 percent.
The ARMM-Office of the Regional Governor reported unremitted

GSIS premiums of P324.57 million or 3.80 percent of the total for the
NG.
The UPS and Eastern Visayas State University reported P83.04 million
and P23.21 million or 46.96 percent and 13.12 percent, respectively, of
the total for SUCs. It may be noted that of the 114 universities/colleges,
six reported abnormal/negative balances totaling P2.98 million.
c. Due to Pag-IBIG
This account represents withheld employees’ premium payments and

other payables for remittance to the Home Development Mutual Fund
163
Amount Percent
Department/Office
Education 400,063 78.38
Justice 19,604 3.84
Health 13,102 2.57
Sub-Total 506,638 99.27
Total 510,388 100.00
The OSEC reported P400.04 million or 99.99 percent of the total for
DepEd.
Four departments/offices posted abnormal/negative balances as

follows:
Amount Percent
Department/Office
Finance 1,392 8.83
Office 1,022 6.48
Total 15,767 100.00
The balance of MMDA resulted from over remittance and erroneous

recording in 1998 to 2000 which are still being reconciled with
pertinent records.
Under the DOF, the BOC reported abnormal/negative balance of P4.28

million balance due to advance recording of remittances owing to the
delayed submission of payrolls by the offices and ports/sub-ports
concerned.
Among the agencies under The Judiciary, the SCP reported abnormal/
negative balance of P1.29 million which pertained to non-adjustment
of remittance withheld from cancelled salaries of former employees
who have retired or resigned, transferred to other government offices or
overpaid due to insufficient leave credits.
The Philippine Information Agency of the PCOO reported

abnormal/negative balance of P1.39 million.
164
d. Due to PhilHealth
This account represents withheld employees’ premium payments for

remittance to the Philippine Health Insurance Corporation by the
Amount Percent
Department/Office
Education 1,112,515 91.49
Health 7,404 0.61
Justice 6,123 0.50
Sub-Total 1,191,720 98.00
Total 1,216,026 100.00
The DepEd-OSEC reported P1.11 billion representing 91.49 percent of

the total Due to PhilHealth of the NG. The SCP reported P13.29 million
or 99.43 percent of the total for The Judiciary while the UPS reported
P6.88 million or 37.53 percent of the total for SUCs.
e. Due to GOCCs
The balance of this account was reported by the following

Amount Percent
Department/Office
Finance 22,882,375 63.56
Energy 72,809 0.20
Sub-Total 35,769,373 99.35
Total 36,003,213 100.00
The DOF, particularly the BTr, reported P22.87 billion or 63.52 percent
of the total Due to GOCCs, detailed as follows:
165
Amount
Particulars
(in thousand pesos)
1. Managed funds and escrow account held by NG for
BSF, Debt Repayment Fund and other GOCCs 9,109,473
2. Remittances of GOCCs 235,765
3. Philippine Coconut Authority collections (8,826)
4. Balance of proceeds from the drawing of USD120
million Performance Bond/Irrevocable Standby Letter
of Credit put up by Maynilad Water Services, Inc. to
secure its concessions fee liabilities with Metropolitan
Waterworks and Sewerage System 133,299
5. NG payable to BSP representing IMF revaluation of the
Special Drawing Rights in Philippine Peso with BSP 12,900,961
6. NG Equity to PhilExim credited to TOP account
pending issuance of EO on the consolidation of
guarantees to serve as a guarantee reserve fund of new
PhilExim 500,000
7. Advances made by LBP for the account of LBP-ARF 86
Total 22,870,758
The amount reported by the DPWH represents receipts from GOCCs

for the implementation of infrastructure projects.
f. Due to LGUs
Amount Percent
Department/Office
Energy 7,176,459 80.87
Sub-Total 8,821,599 99.40
Total 8,874,570 100.00
The balance reported by the DOE represented the subsidy to various

host communities under Energy Regulation No. 1-94. Rule 29 of the
Implementing Rules and Regulations of R.A. No. 9136 required that
generating facilities and/or energy resource development facilities
provide financial benefits of one centavo per kilowatt-hour of their
electricity sales. These funds are maintained as trust funds to be used
for the implementation of electrification, development and livelihood
and reforestation, watershed management, health and/or environment
enhancement projects to the host communities. As at yearend, there
were 96 LGU recipients from the said fund.
166
18. INTRA-AGENCY PAYABLES
18.1. Intra-Agency Payables
Intra-Agency Payables refer to reciprocal accounts that subsist between the

Central Office, Staff Bureaus, ROs and OUs within the agency.
a. Due to Other Funds
This account refers to the transfers from other funds and/or payables to
other funds. To eliminate the effect of intra-agency transactions of the
NG, Due to Other Funds were netted against Due from Other Funds.
After elimination, however, balances still exist in the following
Due to Due from

Other Other Balance
Department/Office
Funds Funds
(in thousand pesos)
Education 181,802 10,887 170,916
Labor and Employment 94,019 10 94,009
Foreign Affairs 457,928 413,145 44,783
Health 436,350 398,498 37,853
Office of the Ombudsman 10,446 1,808 8,637
Mindanao 5,804 - 5,804
Other Executive Offices 5,598 3,962 1,636
The Judiciary 12,897 11,593 1,304
Agriculture 6,490 5,421 1,068
Environment and Natural Resources 7,448 6,941 507
Sub-Total 1,218,782 852,265 366,517
Other Departments/Offices 2,174,282 2,408,917 (234,635)
Total 3,393,064 3,261,182 131,882
balances of Due to Other Funds as of the end of the year.
19. TRUST LIABILITIES
19.1. Trust Liabilities
This sub-major group of accounts is used to recognize receipt of amounts

held in trust for specific purposes. It is accounted under the following
accounts:
167
Amount Amount
to Total to Total
pesos) pesos)
Trust Liabilities 20,196,962 30.54 18,122,615 34.45
Trust Liabilities-Disaster Risk
Reduction and Management
Fund 559,042 0.85 441,394 0.84
Bail Bonds Payable 625,559 0.95 510,702 0.97
Guaranty/Security Deposits
Payable 44,343,349 67.06 33,227,705 63.16
Customers’ Deposits Payable 397,175 0.60 303,623 0.58
Total 66,122,087 100.00 52,606,039 100.00
balances of Trust Liabilities as of the end of the year.
a. Trust Liabilities
Amount Percent
Department/Office
Finance 2,695,261 13.34
Health 660,712 3.27
Justice 503,070 2.49
Sub-Total 18,908,474 93.62
Total 20,196,962 100.00
For the SUCs, the UPS reported P7.13 billion or 35.32 percent of the
total Trust Liabilities of the NG, with UP Los Baños of P4.95 billion.
b. Trust Liabilities-Disaster Risk Reduction and Management Fund
Five departments with balances of this account are as follows:
Amount Percent
Department/Office
Finance 30 0.00
Total 559,042 100.00
168
The account reported by the DSWD-OSEC pertained to cash donations
received, disbursed and/or transferred to FOs which includes FO-VI
fund totaling to P275.84 million for Typhoon Yolanda Rehabilitation.
The Office of the Civil Defense reported the entire for the DND. This
pertained to the balance received from both local and foreign sources
intended for victims of calamities, P16.85 million of which is subject
for liquidation.
c. Bail Bonds Payable
This account refers to the liability arising from the receipt of cash bond
of persons who are in the custody of law to guarantee their appearance
in court at the appointed day and time or the compliance with the
conditions of the bond. This also includes immigration bonds required
from foreign nationals charged with crimes or violations of the
Philippine laws.
Amount Percent
Department/Office
Justice 155,793 24.90
Health 1,555 0.25
Total 625,559 100.00
Of the balance for The Judiciary, the Sandiganbayan and Court of

Appeals reported P283.72 million or 60.82 percent and P165.75 million
or 35.53 percent, respectively. Balances reported by other
departments/offices are subject for further verification and
adjustment/reclassification, if appropriate, by the agencies concerned.
d. Guaranty/Security Deposits Payable
This account pertains to the liability arising from receipt of cash or cash
equivalents to guarantee performance which are refundable after the
fulfillment of the purpose of the bond or forfeiture for failure to comply
with the purpose of the bond.
Amount Percent
Department/Office
Finance 3,724,761 8.40
Health 2,148,108 4.84
Education 1,279,332 2.89
169
Amount Percent
Department/Office
Environment and National Resources 544,181 1.23
Sub-Total 43,405,141 97.88
Total 44,343,349 100.00
The total for the DPWH was reported solely by the OSEC, which
represents 10 percent retention fees from contractors’ billings and
performance bonds posted by suppliers.
e. Customers’ Deposits Payable
The following departments/offices reported balances of this account:
Amount Percent
Department/Office
Office 331,882 83.56
Tourism 18,038 4.54
Finance 9,540 2.40
Health 8,206 2.07
Justice 3,729 0.94
Sub-Total 396,336 99.79
Total 397,175 100.00
The balance for PCOO was reported solely by the NPO which referred
to advance deposits made by different agencies for the purchase of
accountable and standard forms that were not yet delivered as at
yearend.
20. OTHER PAYABLES
20.1. Other Payables
Amount Percent
Department/Office
Education 7,476,673 16.64
170
Amount Percent
Department/Office
Justice 3,157,802 7.03
Health 3,113,368 6.93
Finance 2,034,910 4.53
Sub-Total 41,988,855 93.46
Total 44,928,639 100.00
For the SUCs, the UPS reported P15.35 billion or 34.17 percent of the total
Other Payables. Of the said amount, P6.87 billion representing 15.30
percent of the total Other Payables was accounted in the books of UP
Diliman.
DepEd which comprised but not limited to payables to private lending
institutions and insurance companies for loan repayments and insurance
premiums deducted from salaries of employees.
The DOTr-OSEC reported P5.34 billion or 11.88 percent of the total Other
Payables which included, among others, P2.91 billion payable to Metro
Rail Transit Corporation for collections from the operations of Metro Rail
Transit 3.
Of the total for DOJ, P2.70 billion representing 6.02 percent of the total
Other Payables was reported by the PCGG. This account involved
collections from sequestered assets deposited to the BTr pending litigations
for the rightful ownership. It also included the proceeds of P111 million
from the sale of Wack property awaiting resolution of some legal issues.
The DOH-OSEC reported P3.10 billion or 6.90 percent of the total Other
Payables. This pertained to unpaid salaries of contractual employees,
deductions from salaries of regular employees for payment of monthly dues
and loans from cooperatives, among others.
21. DEFERRED CREDITS/UNEARNED INCOME
21.1. Deferred Credits/Unearned Income
171
Amount Amount
to Total to Total
pesos) pesos)
Other Deferred Credits 4,712,269 95.81 5,285,173 96.82
Unearned Revenue-Investment
Property 30 0.00 - -
Other Unearned Revenue 205,897 4.19 173,812 3.18
Total 4,918,196 100.00 5,458,985 100.00
a. Other Deferred Credits
Amount Percent
Department/Office
Finance 1,869,456 39.67
Health 523,408 11.11
Sub-Total 4,687,744 99.48
Total 4,712,269 100.00
Under the DOF, the BTr reported P1.51 billion or 31.98 percent of the
total Other Deferred Credits of the NG which included the following:
Amount
Particulars
(in thousand pesos)
Accrued Interest on 10-year and 25-year bonds payable,
LBP-ARF 341,255
Interest increment on P.D. No. 27 and E.O. No. 228
claims, LBP-ARF 1,165,814
Total 1,507,069
The UPS with P616.85 million or 13.09 percent of the total Other
Deferred Credits topped among the SUCs.
b. Unearned Revenue-Investment Property
Among the SUCs, the University of Southeastern Philippines reported

a total of P30 thousand which pertained to advances from lessees for
rental of commercial stalls.
172
c. Other Unearned Revenue
This account is used to recognize other income/revenue received in

advance. The departments/offices which reported balances of this
Amount Percent
Department/Office
Health 2,342 1.14
Education 191 0.09
Labor and Employment 13 0.01
Sub-Total 205,894 100.00
Total 205,897 100.00
Among the SUCs, the Carlos C. Hilado Memorial State College

reported P76.74 million or 44.42 percent while TUPS reported P67.91
million or 39.30 percent.
22. PROVISIONS
22.1. Provisions

Amount Amount
to Total to Total
pesos) pesos)
Leave Benefits Payable 42,174 68.95 30,185 63.71
Other Provisions 18,989 31.05 17,195 36.29
Total 61,163 100.00 47,380 100.00
a. Leave Benefits Payable
Amount Percent
Department/Office
Autonomous Region in Muslim Mindanao 140 0.33
Health 109 0.26
173
Amount Percent
Department/Office
Finance (225) (0.53)
Total 42,174 100.00
The TUPS and OSEC reported the entire Leave Benefits Payable of the
SUCs and DepEd, respectively.
The abnormal/negative balance for the DOF was accounted in the books
of Bureau of Local Government Finance.
b. Other Provisions
This account is used to recognize liabilities of uncertain timing or

amount.
Among the departments, only the DND and SUCs reported balances of
this account. The AFP-CES with P17.20 million or 90.55 percent of the
total for NG pertained to the reserve for contingency claims by the
agency’s civilian employees who filed labor cases against the agency.
The amount of P1.79 million or 9.45 percent reported by the Benguet
State University pertained to the claim of a contractor against the
university.
23. FINANCIAL LIABILITIES
Financial Liabilities is composed of the following sub-major groups of accounts:

Amount Amount
to Total to Total
pesos) pesos)
Payables 11,495,554 0.20 8,620,888 0.16
Bill/Bonds/Loans Payable 5,851,988,039 99.80 5,380,871,456 99.84
Total 5,863,483,593 100.00 5,389,492,344 100.00
Financial Liabilities as of the end of the year.
23.1. Payables
Payables consists of the following:
174
Amount Amount
to Total to Total
pesos) pesos)
Interest Payable 102,994 0.90 - -
Finance Lease Payable 765,637 6.66 840,370 9.75
Service Concession
Arrangements Payable 10,626,923 92.44 7,780,518 90.25
Total 11,495,554 100.0 8,620,888 100.00
a. Interest Payable
This account, which was reported exclusively by the OEO-Philippine

Drug Enforcement Agency (PDEA), pertained to the interest of the loan
availed by the Economic Intelligence and Investigation Bureau from
the National Housing Authority which was assumed by the PDEA. The
settlement of the assumed obligation by PDEA is yet to be addressed
while waiting for the approval of the President on PDEA’s request on
the waiver of the penalty of this delinquent account.
b. Finance Lease Payable
This account with a total of P765.64 million represents 0.01 percent

only of the total Financial Liabilities of the NG. It was reported by the
DOF, specifically the BIR, which pertained to the lease payments under
the finance lease contract payable by the Bureau to the lessors, LBP
Leasing Corporation and PRA.
c. Service Concession Arrangements Payable
This account was reported solely by the DepEd-OSEC representing the

financial obligation regarding Public Private Partnership for School
Infrastructure Project (PSIP) Phase I and II which was covered by a
Build-Lease-Transfer Agreement with contractors to finance, design
and construct classrooms in exchange of quarterly lease payments for
the period of ten years, detailed as follows:
Amount Payment Balance

Recapitulation PSIP Particulars
(in thousand pesos)
Bright Future
Package A,
Educational Facilities, I
Region I
Inc. 3,441,882 1,243,172 2,198,710
Citicore-Megawide Package B,
I
Consortium, Inc. Region III 5,229,899 1,876,461 3,353,438
Citicore-Megawide Package C,
Consortium, Inc. I Region IV-
A 7,593,214 2,518,439 5,074,775
Megawide Construction
II Package A
Corporation 1,358,020 1,358,020 -
Bsp & Company, Inc.
/Vicente T.Lao II Package E
Construction (Jv) 978,302 978,302 -
Total 18,601,317 7,974,394 10,626,923
175
23.2. Bills/Bonds/Loans Payable
Gross Carrying
Premium Discount
Accounts Amount Amount
(in thousand pesos)
Bonds Payable-Domestic 3,813,841,489 3,473,184 56,397,110 3,760,917,563
Bonds Payable-Foreign 1,364,059,948 2,218,976 65,763,290 1,300,515,634
Loans Payable-Domestic 614,669 - - 614,669
Loans Payable-Foreign 789,940,173 - - 789,940,173
Total 5,968,456,279 5,692,160 122,160,400 5,851,988,039
a. Bonds Payable-Domestic
Except for the nil amount of P2.30 thousand reported by DA-OSEC,

the total Bonds Payable-Domestic of P3.760 trillion or almost 100
percent was reported by DOF-BTr representing T-Bonds issued
domestically with a maturity beyond one year.
b. Bonds Payable-Foreign
This account, reported solely by the DOF-BTr, pertained to offshore

bond flotations of the ROP that will be maturing beyond a period of one
year.
c. Loans Payable-Domestic
The balance of this account was reported by the four

departments/offices, as follows:
Amount Percent
Department/Office
Agriculture 806 0.13
Total 614,668 100.00
The PUP topped the SUCs with P415.13 million or 67.54 percent of the
total Loans Payable-Domestic of the NG. This pertained to the non-
current portion of the loan from the GSIS for the purchase of the
Condotel-Hostel located in Manila.
The total for MMDA represents its loans from LBP for the Metro
Manila Kilusang Kabuhayan at Kaunlaran Livelihood Projects.
d. Loans Payable-Foreign
The balance of this account was reported by three departments/offices,
176
as follows:
Amount Percent
Department/Office
Finance 789,825,874 99.99
Total 789,940,173 100.00
The balance for DOF was reported solely by the BTr.
The balance for DFA was recognized entirely by the OSEC

representing the Foreign Currency Deposit Unit loan granted by PNB,
London in connection with the acquisition of property at Suffolk Street,
London on April 10, 2006 which serves as the Philippine Chancery
authorized per UK-369-OUA-2006 dated July 12, 2006. The loan is
payable in 13 years in 52 equal installments due every quarter.
The Loans Payable-Foreign acquired by the MMDA in 1982 at 8.25

percent per annum from the IBRD was intended for Infrastructure
Maintenance and Development Management Systems of the Metro
Manila Infrastructures and Utilities Program.
24. TRUST LIABILITIES
24.1. Trust Liabilities
The total Trust Liabilities consists of the following sub-major groups of

accounts:

Sub-Major Group of Amount Amount
Percent Percent
Accounts (in thousand (in thousand
to Total to Total
pesos) pesos)
Trust Liabilities 14,067,197 89.90 1,294,217 11.34
Bail Bonds Payable 122,907 0.79 9,198,943 80.61
Guaranty/Security Deposits
Payable 563,094 3.60 896,723 7.86
Customers’ Deposits Payable 894,219 5.71 22,022 0.19
Total 15,647,417 100.00 11,411,905 100.00
balances of Trust Liabilities as of the end of the year.
a. Trust Liabilities
177
Amount Percent
Department/Office
Sub-Total 14,066,770 100.00
Total 14,067,197 100.00
The balance for The Judiciary which was reported solely by the SCP
comprised of Office of the Court Administrator Fiduciary Fund and
Fiduciary Fund Notarial collections.
The total Trust Liabilities recognized by DND, particularly the GHQ-

AFP which amounted to P540.57 million, pertained to reimbursable
amounts received from United Nations Mission and Balikatan Title X
and other trust receipts.
Among the OEOs, the Commission on Higher Education and the

HLURB topped the list with P138.51 million or 43.98 percent, and
P130.38 million or 41.40 percent, respectively.
b. Bail Bonds Payable
The balance of this account was reported by two departments/offices,

as follows:
Amount Percent
Department/Office
Justice 30 0.02
Total 122,907 100.00
The Presidential Electoral Tribunal (PET) of The Judiciary reported

P74.20 million or 60.37 percent of the total Bail Bonds Payable of the
NG which pertained to the partial cash deposit for the election counter-
protest for Vice President per PET Case No. 005.
c. Guaranty/Security Deposits Payable
178
Amount Percent
Department/Office
Justice 169,435 30.09
Finance 2,723 0.48
Sub-Total 559,836 99.42
Total 563,094 100.00
The LRA reported the entire DOJ’s total, details of which are as
follows:
Amount
Particulars
(in thousand pesos)
Retention Fee-Contractor 2,865
Retention Fee-Land Registration System, Inc. 166,240
Bid/Performance Bond Payable 330
Total 169,435
Among the SUCs, the Mindanao State University System topped the
list which reported P53.82 million or 9.56 percent of the total
Guaranty/Security Deposits Payable of the NG.
d. Customers’ Deposits Payable
This account, which is used to recognize the cash deposits from

customers for goods/services, was reported by the following
Amount Percent
Department/Office
Finance 18,263 2.04
Total 894,219 100.00
The amounts for The Judiciary and DOF were reported solely by the
SCP and PMO, respectively. The total for SCP comprised of LC’s
Sheriff’s Trust Fund collections while the PMO’s accounts represented
deposits from the buyers of property of North Davao Mining
Corporation, National Coal Authority, and Pamplona Redwood and
179
Veneer, Inc.
25. DEFERRED CREDITS/UNEARNED INCOME
25.1. Deferred Credits/Unearned Income

Amount Amount
to Total to Total
pesos) pesos)
Other Deferred Credits 27,576,409 99.99 26,291,412 99.91
Other Unearned Revenue 2,145 0.01 24,008 0.09
Total 27,578,554 100.00 26,315,420 100.00
a. Other Deferred Credits
Amount Percent
Department/Office
Finance 27,189,460 98.60
Justice 82,843 0.30
Office 8,271 0.03
Sub-Total 27,575,681 100.00
Total 27,576,409 100.00
Of the balance for the DOF, PMO reported P15.66 billion or 57.59
percent which arose from the installment sale of transferred assets. The
BIR reported P9.97 billion or 36.67 percent representing the
unredeemed Backpay Certificate of Indebtedness turned over to the BTr
for redemption and donated lot by the Provincial Government of
Pampanga to which a condition was attached.
The BTr also reported P1.56 billion or 5.74 percent, detailed as follows:
Amount
Particulars
(in thousand pesos)
1. Proceeds from ROP’s issuance of Debt Exchange
Warrants which entitles the holders during exercise
period to tender dollar/euro bonds and receives in
exchange a peso denominated treasury bonds. 1,471,585
2. Contra account in setting up the receivable from DBP
and PMO 44,612
180
Amount
Particulars
(in thousand pesos)
3. Capitalized interest and other charges, LBP-ARF 38,776
4. Unearned discount on Treasury Bills held by BSF 4,301
5. Converted balance under Fund 105 which had remained
dormant for over 30 years and was already requested for
write-off 566
Total 1,559,841
b. Other Unearned Revenue
This account was reported solely by the SUCs. Of the 114 universities
and colleges, only the Northwest Samar State University, Quirino State
College and Isabela State University reported balances of this account.
26. OTHER PAYABLES
26.1. Other Payables
The following departments/offices reported balances of Other Payables:
Amount Percent
Department/Office
Finance 169,502 0.57
Justice 159,944 0.54
Sub-Total 29,641,803 99.94
Total 29,660,417 100.00
The amount for the DSWD was reported solely by the OSEC which
represents mainly of unpaid cash grants of P27.06 billion or 94.64 percent
for 4Ps beneficiaries. The remaining amount of P1.53 billion or 0.36
percent pertained to trust account from United Nations Development
Programme, payroll deductions for remittance to KBC Bank Ireland,
Mutual Benefits Association, Social Welfare Employees Association of the
Philippines, Project to Supplement Personnel Economic Resources, SSS,
healthcard, and other individual creditors/suppliers which include service
providers/suppliers of Crisis Intervention Unit clients.
181
27. PROVISIONS
27.1. Provisions

Amount Amount
Accounts Percent Percent
to Total to Total
pesos) pesos)
Pension Benefits Payable 1,995,568 99.89 2,911,643 99.92
Leave Benefits Payable 1,160 0.06 1,709 0.06
Retirement Gratuity Payable 1,112 0.06 554 0.02
Total 1,997,840 100.00 2,913,906 100.00
Three departments/offices reported balances of this sub-major groups of

accounts, as follows:
Amount Percent
Department/Office
Total 1,997,840 100.00
The balance for the DND was reported solely by the Philippine Veterans
Affairs Office representing pension benefits payable to pensioners/
beneficiaries.
The PCG reported solely the balance for the DOTr with the following
details:
Amount Percent
Accounts
Pension Benefits Payable 7,412 80.28
Leave Benefits Payable 709 7.68
Retirement Gratuity Payable 1,112 12.04
Total 9,233 100.00
The entire balance of the SUCs was disclosed by Leyte Normal University
pertaining to the accrued money value of the earned vacation and sick leave
credits of an employee who retired on December 7, 2017.
28. CONTINGENT LIABILITIES
As disclosed by the BTr, the recognized liabilities did not include the following
total contingent liabilities of the NG amounting to P478.11 billion:
182
Foreign Domestic
Particulars Currency
(in thousand pesos)
NG Direct Guarantee on GOCC Loans USD 5,531,079
Peso 276,321,626 197,381,136
GFI Guarantee Assumed by NG per USD 85,562
Proclamation 50 Peso 4,274,525 136,069
Total USD 5,616,641
Peso 280,596,151 197,517,205
Excluded from the list are the contingent liabilities of the NG under the PPP
Program such as: build-operate and own, build-operate and transfer, build and
transfer, and build-transfer and operate wherein the valuation of the extent of the
NG liabilities or exposure cannot yet be established in the absence of complete data
regarding these projects. Also excluded in this Report are the guarantees extended
by the GFIs considering that there is no explicit NG guarantee on these.
The DOF-PMO also disclosed a contingent liability to the GSIS of P1.78 million
representing bond premium from February14, 2014 to February 14, 2017 or a
yearly premium of P593.72 thousand relative to the Court of Tax Appeals (CTA)
Resolution dated February 7, 2013. This ensued as the Tacloban City Government
(TCG) issued Warrants of Levy over the properties of Leyte Park Hotel for non-
payment of real property tax of P65.96 million. The PMO obtained Temporary
Restraining Order (TRO) on the motion for suspension of collection of real
property tax and cancellation of warrants of levy. The CTA issued the TRO
provided that PMO files a surety bond equivalent to one and one-half of the amount
being claimed by TCG. The Petition for Certiorari on the motion for exemption
from posting of surety bond is still pending before the Supreme Court.
29. TAX REVENUE
FY 2017 total tax revenue collections of P2.257 trillion, which was 89.44 percent
of the total revenue of P2.524 trillion, has increased by P270.90 billion or 13.64
percent compared to previous year’s tax revenue of P1.986 trillion. Details of this
major group of accounts are shown below.
2016
2017
(in thousand pesos)
Tax Revenue-Individual and Corporation
Income Tax 987,748,394 884,198,478
Immigration Tax 115,702 86,668
Total Tax Revenue-Individual and Corporation 987,864,096 884,285,146
Tax Revenue-Property
Estate Tax 3,506,114 3,818,018
Donors Tax 1,864,089 1,755,684
Capital Gains Tax 25,208,472 25,729,675
Total Tax Revenue-Property 30,578,675 31,303,377
Tax Revenue-Goods and Services
Import Duties 59,576,254 58,544,179
Excise Tax 270,238,669 214,582,182
Business Tax 786,078,470 689,761,337
Tax on Sand, Gravel and Other Quarry Products - 144
183
2016
2017
(in thousand pesos)
Tax on Forest Products - 18,971
Total Tax Revenue-Goods and Services 1,115,893,393 962,906,814
Tax Revenue-Others
Documentary Stamp Tax 81,996,097 75,094,378
Motor Vehicles Users' Charge 15,906,807 14,375,050
Other Taxes 20,114,060 15,371,684
Total Tax Revenue-Others 118,016,964 104,841,112
Tax Revenue-Fines and Penalties
Tax Revenue-Fines and Penalties-Taxes on Individual
and Corporation 1,813,950 1,287,044
Tax Revenue-Fines and Penalties-Property Taxes 432,555 310,958
Tax Revenue-Fines and Penalties-Taxes on Goods and
Services 585,088 540,534
Tax Revenue-Fines and Penalties-Other Taxes 1,996,792 806,861
Total Tax Revenue-Fines and Penalties 4,828,385 2,945,398
Total Tax Revenue 2,257,181,513 1,986,281,847
29.1. Tax Revenue–Individual and Corporation
Tax Revenue-Individual and Corporation represented 43.77 percent of the

total tax revenue of P2.257 trillion for FY 2017. The Income Tax revenue
of P987.75 billion or 99.99 percent was the highest collection in this sub-
major group of accounts. The income tax collections of DOF-BIR increased
by P103.55 billion or 11.71 percent from previous year’s collections of
P884.20 billion. Immigration tax collections of P115.70 million, reported
by DOJ-BI, also increased by P29.03 million compared to previous year’s
amount of P86.67 million.
29.2. Tax Revenue–Property
BIR reported a total of P30.58 billion property tax collections for FY 2017,
lower by P724.70 million or 2.32 percent than previous year’s P31.30
billion. Capital Gains Tax contributed the highest component at P25.21
billion or 82.44 percent, followed by Estate Tax at P3.51 billion or 11.47
percent, and Donors Tax at P1.86 billion or 6.10 percent. This sub-major
group of accounts represented 1.35 percent of the total tax revenue.
29.3. Tax Revenue–Goods and Services
The total collections on Tax Revenue-Goods and Services, which

represented 49.44 percent of the total tax revenue, increased to P1.116
trillion, higher by P152.99 billion or 15.89 percent than previous year’s
P962.91 billion. This was reported by DOF-BIR and BOC at P651.20
billion or 58.36 percent and P464.69 billion or 41.64 percent, respectively.
29.4. Tax Revenue–Others
Collections of Tax Revenue-Others of P118.02 billion, which represented

5.23 percent of the total tax revenue, was higher by P13.18 billion or 12.57
184
percent than previous year’s P104.84 billion.
Of the total Tax Revenue-Others, Documentary Stamp Tax registered the

highest component at P82 billion or 69.48 percent. Of this amount, P81.54
billion or 99.45 percent was collected by DOF-BIR. Motor Vehicle Users’
Charge totalling P15.91 billion or 13.48 percent of total tax revenue-others
was reported by DOTr-LTO. Of Other Taxes of P20.11 billion or 17.04
percent of the Tax Revenue-Others, P19.96 billion or 99.25 percent was
reported by DOF-BIR.
29.5. Tax Revenue–Fines and Penalties
Tax Revenue-Fines and Penalties total collections of P4.83 billion

increased by P1.88 billion or 63.93 percent from previous year’s amount of
P2.95 billion. The increase was due to the significant 147.48 percent
increase of Tax Revenue-Fines and Penalties-Other Taxes from P806.86
million in FY 2016 to P2 billion in FY 2017. DOF-BIR contributed P4.77
billion or 98.73 percent of the total collections while the remaining P61.52
million or 1.27 percent was collected by DOF-BOC and DOTr-OSEC.
30. SERVICE AND BUSINESS INCOME
Total service and business income of P197.87 billion, which represented 7.84
percent of the total revenue of P2.524 trillion, decreased by P10.65 billion or 5.69
percent from FY 2016 of P187.23 billion. The composition of this major group of
accounts is as follows:

Particulars
(in thousand pesos)
Service Income
Permit Fees 1,719,715 1,443,813
Registration Fees 14,995,097 14,434,488
Registration Plates, Tags and Stickers Fees 1,246,072 1,242,160
Clearance and Certification Fees 3,562,295 2,730,801
Franchising Fees 98,648 136,225
Licensing Fees 4,832,108 3,465,980
Supervision and Regulation Enforcement Fees 4,546,524 4,214,409
Spectrum Usage Fees 2,365,411 2,708,340
Legal Fees 2,774,544 2,882,471
Inspection Fees 849,680 792,331
Verification and Authentication Fees 2,637,708 2,052,014
Passport and Visa Fees 6,318,387 5,380,387
Processing Fees 3,128,999 2,906,577
Fines and Penalties-Service Income 2,058,447 2,132,780
Other Service Income 18,812,842 19,472,471
Total Service Income 69,946,478 65,995,247
Business Income
School Fees 11,663,763 12,891,875
Affiliation Fees 90,714 90,374
Examination Fees 1,008,490 855,041
Seminar/Training Fees 849,189 730,035
Rent/Lease Income 991,160 846,815
185
Particulars
(in thousand pesos)
Communication Network Fees 8,952 9,203
Transportation System Fees 16 48
Road Network Fees 45,612 39,334
Waterworks System Fees 3,632 3,703
Power Supply System Fees 2,183 2,517
Landing and Parking Fees 1,604 4,823
Income from Hostels/Dormitories and Other
Like Facilities 608,854 438,954
Slaughterhouse Operation 578 380
Income from Printing and Publication 89,230 77,203
Sales Revenue 15,304,331 14,544,304
Sales Discounts (86,243) (154,284)
Cost of Sales (14,096,213) (13,371,796)
Net Sales 1,121,874 1,018,224
Hospital Fees 16,134,501 14,350,120
Guarantee Income 5,509,641 2,828,561
Fidelity Insurance Income 964,330 975,451
Dividend Income 31,240,581 26,142,632
Interest Income 49,263,842 53,141,394
Share in the Profit of Joint Venture 809,031 96,690
Fines and Penalties-Business Income 359,794 234,044
Service Concession Revenue 16,830 13,231
Other Business Income 7,141,361 6,440,881
Total Business Income 127,925,760 121,231,531
Total Service and Business Income 197,872,237 187,226,779
30.1. Service Income
Service Income of P69.95 billion, which represented 35.35 percent of the

total service and business income, was higher by P3.95 billion or 5.99
percent than previous year’s reported income of P66 billion. The Other
Service Income of P18.81 billion or 26.90 percent was the biggest
component of total service income, followed by Registration Fees of P15
billion or 21.44 percent, Passport and Visa Fees of P6.32 billion or 9.03
percent, Licensing Fees of P4.83 billion or 6.91 percent, and Supervision
and Regulation Enforcement Fees of P4.55 billion or 6.50 percent.
The departments/offices which reported substantial amount of Service

Income are as follows:
Amount Percent
Department/Office
Justice 14,518,547 20.76
Finance 7,812,278 11.17
Information and Communication Technology 5,106,701 7.30
186
Amount Percent
Department/Office
Sub-total 61,692,401 88.20
Total Service Income 69,946,478 100.00
Most of the total Other Service Income of P18.81 billion was reported by
the following departments/agencies: DPWH-OSEC – P2.68 billion, DOJ-
BI – P2.42 billion, and DOTr – P2.40 billion.
The agencies with the biggest registration fees were: DOJ-LRA – P8.58
billion, DOF-SEC – P2.35 billion and DOF-BIR – P958.09 million. DFA
reported P6.29 billion or 99.56 percent collections on Passport and Visa
Fees.
The biggest collections of Licensing Fees were reported by the following

departments/agencies: DOTr-OSEC – P2.95 billion, DOLE-PRC and
POEA – P664.56 million, and DILG-PNP – 577.69 million. Licensing Fees
collected by PNP refers to firearm and explosives licenses fees and security
agency & guard licenses for private security agencies, private detective
agencies, company guard force and government security force.
30.2. Business Income
Total business income of P127.93 billion, which was 64.65 percent of total
service and business income, was P6.69 billion or 5.52 percent higher than
previous year of P121.23 billion. The highest source of business income
was Interest Income of P49.26 billion or 38.51 percent, of which P46.60
billion or 94.59 percent was reported by DOF BTr-NG, followed by
Dividend Income of P31.24 billion or 24.42 percent, of which P31.21
billion or 99.90 percent was also reported by DOF BTr-NG.
Other sources of significant business income were Hospital Fees and

School Fees of P16.13 billion or 12.61 percent and P11.66 billion or 9.12
percent, respectively. The DOH-OSEC reported total collections of
Hospital Fees of P14.78 billion or 91.60 percent, while SUC-UPS
(Philippine General Hospital) reported P912.56 million or 5.66 percent.
School Fees were mainly reported by SUCs, the biggest collections of
which were: Batangas State University – P653.48 million or 5.60 percent,
Cavite State University – P486.17 million or 4.17 percent, Bulacan State
University – P456.44 million or 3.91 percent, and Cebu Technological
University – P359.55 million or 3.08 percent.
The departments/offices which reported substantial amounts of business

income were the following:
187
Amount Percent
Department/Office
Finance 91,026,879 71.16
Health 15,162,572 11.85
Civil Service Commission 507,774 0.40
Sub-total 126,549,271 98.92
Total Business Income 127,925,760 100.00
31. SHARES, GRANTS AND DONATIONS
Income from shares, grants and donations totalling P67.58 billion represented 2.68
percent of the total revenue. This amount was higher by P12.09 billion or 21.79
percent compared to previous year of P55.49 billion. The details were as follows:
2017 2016 (Restated )

Particulars
(in thousand pesos)
Shares
Share from National Wealth 22,745,392 17,386,719
Share from PAGCOR/PCSO 35,248,853 32,073,545
Share from Earnings of GOCCs 1,697,541 1,898,253
Sub-total 59,691,787 51,358,517
Grants and Donations
Income from Grants and Donations in Cash 3,074,306 2,199,849
Income from Grants and Donations in Kind 4,813,661 1,928,256
Sub-total 7,887,967 4,128,106
Total 67,579,754 55,486,623
31.1. Share from National Wealth
Share from National Wealth represents government’s share on royalties,

production share on service contracts and other similar income from the
exploration, development and utilization of natural resources.
DOE collections of P21.61 billion or 95 percent of the total Share from
National Wealth was computed in accordance with Petroleum Act of 1949
and its Implementing Rules and Regulations. These collections form part
of the SAGF to finance energy resource development and exploration
programs and other government projects. DENR reported the remaining
P1.14 billion collections or 5 percent.
188
31.2. Share from PAGCOR/PCSO
This account represents share of government agencies from receipts of

Philippine Amusement and Gaming Corporation (PAGCOR) and
Philippine Charity Sweepstakes Office (PCSO). For FY 2017, this account
posted a balance of P35.25 billion, with an increase of P3.18 billion or 9.90
percent compared to previous year of P32.07 billion. Recipients of the total
Share from PAGCOR/PCSO were as follows:
Amount Percent
Department/Office
Finance
BTr-NG 26,728,859 75.83
Philippine Sports Commission 1,306,016 3.71
Dangerous Drugs Board 120,000 0.34
Philippine Drug Enforcement Agency 25,000 0.07
Interior and Local Government
Philippine National Police 318,024 0.90
Education
Early Childhood Care and Development
Council 250,000 0.71
Health 954 0.00
Total 35,248,853 100.00
Dangerous Drugs Board (DDB) receives 10 percent of all unclaimed and

forfeited sweepstakes and lotto prizes but not less than P12 million per year
from the PCSO and P5 million a month from PAGCOR. The amount of
P120 million received in FY 2017 was still in the National Treasury as at
year-end.
The amount of P25 million reported by Philippine Drug Enforcement

Agency was the mandatory contribution from PCSO for anti-drug
operations received in August 2017 per E.O. No. 218, to fund its operations
and the task forces supporting it. The amount was remitted to the National
Treasury to be utilized for FY 2018 operations. PNP share was from PCSO
Small Town Lottery revenue.
PAGCOR contributed/granted P250 million to DepEd-Early Childhood

Care and Development Council as mandated in Section 10.2 of R.A. No.
10410 to fund the establishment of National Child Development Center and
conversion of existing day care centers to child development centers in
various LGUs.
31.3. Share from Earnings of GOCCs
Share from Earnings of GOCCs represents mandatory/statutory shares of

government agencies from earnings of GOCCs other than PAGCOR and
PCSO.
189
The departments/offices which received total share of P1.70 billion from
earnings of GOCCs were as follows:
Amount Percent
Department/Office
Finance-BTr NG 1,612,114 94.97
Tourism 82,106 4.84
Other Executive Offices-DDB 3,321 0.20
Total 1,697,541 100.00
Pursuant to Section 105 of R.A. No. 9593, DOT receives a share of net
income from its attached GOCCs.
31.4. Income from Grants and Donations
Total Income from Grants and Donations of P7.89 billion, which

represented 11.67 percent of total shares, grants and donations, was higher
by P3.76 billion than previous year of P4.13 billion. Of the total grants and
donations, P3.07 billion or 38.97 percent was received in cash and P4.81
billion or 61.03 percent was received in kind.
The departments/offices which received grants and donations were as

follows:
Amount Percent
Department/Office
Finance 2,428,673 30.79
Education 1,896,300 24.04
Health 1,108,223 14.05
Metro Manila Development Authority 167,268 2.12
Energy 149,935 1.90
Sub-total 7,628,751 96.71
Total 7,887,967 100.00
32. MISCELLANEOUS INCOME
Miscellaneous Income of P883.87 million was higher by P110.04 million or 14.22

percent compared to FY 2016 of P773.83 million. Details are as follows:

Particulars
(in thousand pesos)
Proceeds from Insurance/Indemnities 24,435 36,170
Miscellaneous Income 859,436 737,664
Total 883,871 773,834
190
The departments/offices with their corresponding miscellaneous income are
enumerated as follows:
Amount Percent
Department/Office
Health 268,390 30.37
Finance 16,305 1.84
Sub-total 832,035 94.14
Total 883,871 100.00
33. GAINS
Total gains of P76.76 million was higher by P29.74 million or 63.25 percent
compared to previous year of P47.02 million. Except for Gain from Changes in
Fair Value Less Cost to Sell of Biological Assets Due to Price Change, all other
gains accounts reported increases. The breakdown of gains are as follows:
2016
2017
(in thousand pesos)
Gain on Initial Recognition of Biological Assets 19,479 19,218
Gain on Sale of Biological Assets 9,126 2,726
Gain from Changes in Fair Value Less Cost to Sell of
Biological Assets Due to Physical Change 29,943 19,469
Gain from Changes in Fair Value Less Cost to Sell of
Biological Assets Due to Price Change 27 229
Gain on Sale of Agricultural Produce 14,896 5,380
Gain on Initial Recognition of Agricultural Produce 3,292 -
Total 76,763 47,021
The departments/offices/agencies with reported gains are as follows:
Amount Percent
Department/Office/Agency (in thousand pesos) to Total
Office of the Secretary 14,828
Philippine Carabao Center 38,402
Central Mindanao University 12,842
Bataan Peninsula State University 3,309
Mariano Marcos State University 1,697
191
Amount Percent
Department/Office/Agency (in thousand pesos) to Total
Other State Universities and Colleges 4,409
Total 76,763 100.00
34. PERSONNEL SERVICES
Total Personnel Services (PS) of P831.60 billion represented the biggest share at
54.09 percent of the total current operating expenses of P1.537 trillion. Compared
to previous year of P762.08 billion, total PS increased by P69.52 billion or 9.12
percent. The composition of PS was as follows:

Particulars
(in thousand pesos)
Salaries and Wages 430,283,694 386,789,137
Other Compensation 232,576,800 204,659,774
Personnel Benefit Contributions 49,205,823 44,097,707
Other Personnel Benefits 119,530,576 126,531,833
Total 831,596,894 762,078,452
As shown in the following table, the DepEd was the biggest spending department
for PS at P324.95 billion or 39.07 percent.
Amount Percent
Department/Office
Education 324,946,449 39.07
Health 30,770,753 3.70
Justice 14,132,893 1.70
Sub-total 749,817,732 90.17
Total 831,596,894 100.00
34.1. Salaries and Wages
Total salaries and wages of P430.28 billion constituted 51.74 percent of the
total PS, of which P417.42 billion or 97.01 percent was paid to regular
civilian employees and uniformed personnel, and the remaining balance of
P12.86 billion or 2.99 percent was paid to casual/contractual personnel, as
shown in the following table:
192
2016
2017
(in thousand pesos)
Salaries and Wages-Regular 417,426,739 374,568,910
Salaries and Wages-Casual/Contractual 12,856,955 12,220,227
Total 430,283,694 386,789,137
DepEd-OSEC, DILG-PNP, and DND-PA incurred the largest amount of

salaries and wages of P219.17 billion, P42.32 billion, and P19.01 billion,
respectively. The total salaries and wages by department/office is broken
down as follows:
Amount Percent
Department/Office
Education 219,286,570 50.96
Health 17,063,205 3.97
Justice 8,129,200 1.89
Sub-total 385,060,220 89.49
Total 430,283,694 100.00
34.2. Other Compensation
Other compensation totalling P232.58 billion was 27.97 percent of the total
PS, an increase of P27.92 billion or 13.64 percent from previous year of
P204.66 billion. This increase was mainly due to the 55.08 percent increase
in Other Bonuses and Allowances account of P19.41 billion. The top three
departments that contributed to this increase were DILG, DND, and DepEd,
with an increase of P8.74 billion, P4.69 billion, and P3.09 billion,
respectively. The comparative details of other compensation are as follows:
2016
2017
(in thousand pesos)
Personal Economic Relief Allowance (PERA) 35,180,796 33,546,336
Representation Allowance (RA) 2,083,438 2,180,054
Transportation Allowance (TA) 1,879,067 1,744,338
Clothing/Uniform Allowance 9,138,597 8,502,623
Subsistence Allowance 23,347,614 21,863,593
Laundry Allowance 275,658 264,484
Quarters Allowance 1,900,292 1,892,843
Productivity Incentive Allowance 624,328 742,377
Overseas Allowance 5,560,915 5,341,564
Honoraria 3,148,861 3,156,930
Hazard Pay 7,918,659 6,115,648
Longevity Pay 19,376,026 18,059,261
193
2016
2017
(in thousand pesos)
Overtime and Night Pay 1,428,832 1,231,732
Year End Bonus 58,757,033 57,830,874
Cash Gift 7,305,834 6,947,067
Other Bonuses and Allowances 54,650,848 35,240,049
Total 232,576,800 204,659,774
The top spenders for this group of accounts are DepEd-OSEC, DILG-PNP,
and DND-PA, with P70.67 billion, P54.58 billion, and P25.39 billion,
respectively. The departments/offices and their respective expenses for
total other compensation are as follows:
Amount Percent
Department/Office
Education 70,721,163 30.41
Health 10,382,436 4.46
Justice 3,474,763 1.49
Sub-total 211,617,596 90.99
Total 232,576,800 100.00
34.3. Personnel Benefit Contributions
Government’s share in personnel benefit contributions of P49.21 billion

was 5.92 percent of the total PS. Compared to previous year’s figure of
P44.10 billion, there was an increase of P5.11 billion or 11.58 percent. The
comparative details of personnel benefit contributions are as follows:
2016
2017
(in thousand pesos)
Retirement and Life Insurance Premiums 40,699,160 36,283,948
Pag-IBIG Contributions 1,964,935 1,741,714
PhilHealth Contributions 4,590,407 4,293,290
Employees Compensation Insurance Premiums 1,791,983 1,675,189
Provident/Welfare Fund Contributions 159,337 103,567
Total 49,205,823 44,097,707
The total personnel benefit contributions was incurred by the

departments/offices as follows:
194
Amount Percent
Department/Office
Education 30,317,052 61.61
Health 2,350,011 4.78
Sub-total 43,111,464 87.61
Total 49,205,823 100.00
34.4. Other Personnel Benefits
Other personnel benefits of P119.53 billion, which represented 14.37

percent of the total PS, was lower by P7 billion or 5.53 percent than
previous year’s total of P126.53 billion. The comparative details of other
personnel benefits are as follows:
2016
2017
(in thousand pesos)
Pension Benefits 78,431,789 79,930,495
Retirement Gratuity 7,474,277 8,469,627
Terminal Leave Benefits 14,153,622 15,475,126
Other Personnel Benefits 19,470,889 22,656,585
Total 119,530,576 126,531,833
The total other personnel benefits was incurred by the following

Amount Percent
Department/Office
Education 4,621,663 3.87
Justice 1,834,360 1.53
Commission on Audit 1,294,751 1.08
Health 975,101 0.82
Congress 858,155 0.72
Sub-total 115,490,228 96.62
Total 119,530,576 100.00
195
35. MAINTENANCE AND OTHER OPERATING EXPENSES
Total Maintenance and Other Operating Expenses (MOOE) of P302.21 billion was
19.66 percent of the total current operating expenses. FY 2017 MOOE had a net
increase of P55.18 billion or 22.34 percent compared to previous year of P247.03
billion mainly due to increases in three major components, as follows: Other
Maintenance and Operating Expenses of P17.43 billion, Supplies and Materials of
P9.49 billion, and Professional Services of P7.94 billion.
The top five major components of MOOE are Supplies and Materials Expenses of
P69.67 billion or 23.05 percent; Other Maintenance and Operating Expenses of
P63.55 billion or 21.03 percent; Professional Services of P31.11 billion or 10.30
percent; Training and Scholarship Expenses of P30.80 billion or 10.19 percent; and
Repairs and Maintenance of P26.96 billion or 8.92 percent. The components of
MOOE are as follows:
2016
2017
(in thousand pesos)
Traveling Expenses 14,520,669 12,220,251
Training and Scholarship Expenses 30,792,183 23,802,037
Supplies and Materials Expenses 69,669,031 60,177,324
Utility Expenses 14,299,955 12,878,663
Communication Expenses 4,644,623 4,360,674
Awards/Rewards and Prizes 758,616 670,415
Survey, Research, Exploration and Development Expenses 989,288 909,689
Demolition/Relocation and Desilting/Dredging Expenses 63,862 32,867
Generation, Transmission and Distribution Expenses 7,957 14,510
Confidential, Intelligence and Extraordinary Expenses 8,967,373 4,444,111
Professional Services 31,113,658 23,176,078
General Services 15,029,871 13,528,385
Repairs and Maintenance 26,955,059 25,037,838
Taxes, Insurance Premiums and Other Fees 17,703,079 17,281,247
Labor and Wages 3,145,691 2,376,453
Other Maintenance and Operating Expenses 63,547,855 46,118,265
Total 302,208,768 247,028,808
The DepEd incurred the biggest amount of MOOE at P37.27 billion or 12.33
percent of the total MOOE. Other departments/offices and their corresponding
MOOE are as follows:
Amount Percent
Department/Office
Education 37,265,479 12.33
Health 33,023,154 10.93
Finance 20,161,722 6.67
196
Amount Percent
Department/Office
Sub-total 219,951,056 72.78
Total 302,208,768 100.00
35.1. Traveling Expenses
Traveling expenses totalling P14.52 billion represented 4.80 percent of the

total MOOE. This group of accounts posted an increase of P2.30 billion or
18.82 percent from previous year’s total of P12.22 billion. The comparative
details are as follows:
2016
2017
(in thousand pesos)
Traveling Expenses-Local 11,923,446 9,853,015
Traveling Expenses-Foreign 2,597,222 2,367,236
Total 14,520,669 12,220,251
The total traveling expenses was incurred by the following

Amount Percent
Department/Office
Education 2,284,883 15.74
Health 651,309 4.49
Sub-total 9,750,713 67.15
Total 14,520,669 100.00
35.2. Training and Scholarship Expenses
Training and scholarship expenses totalling P30.79 billion represented

10.19 percent of the total MOOE. This group of accounts posted an increase
of P6.99 billion or 29.37 percent from previous year’s total of P23.80
billion. The comparative details are as follows:
197
2016
2017
(in thousand pesos)
Training Expenses 20,758,854 15,763,438
Scholarship Grants/Expenses 10,033,329 8,038,599
Total 30,792,183 23,802,037
The total training and scholarship expenses was incurred by the following
Amount Percent
Department/Office
Education 6,928,262 22.50
Health 1,773,235 5.76
Sub-total 27,653,658 89.81
Total 30,792,183 100.00
35.3. Supplies and Materials Expenses
This group of accounts in the total amount of P69.67 billion or 23.05

percent is the top component of MOOE. It posted an increase of P9.49
billion or 15.77 percent from previous year’s amount of P60.17 billion.
Overall increase was attributed to the significant increases in semi-
expendable expenses, welfare goods expenses, and textbooks and
instructional materials expenses. The comparative details of supplies and
materials expenses are as follows:
2016
2017
(in thousand pesos)
Office Supplies Expenses 12,162,915 11,115,972
Accountable Forms Expenses 4,201,612 3,557,379
Non-Accountable Forms Expenses 32,212 39,145
Animal/Zoological Supplies Expenses 216,947 179,184
Food Supplies Expenses 8,299,112 6,723,404
Welfare Goods Expenses 2,671,810 1,651,314
Drugs and Medicines Expenses 5,801,544 4,802,767
Medical, Dental and Laboratory Supplies
Expenses 7,285,642 5,777,222
Fuel, Oil and Lubricants Expenses 8,321,352 7,851,693
Agricultural and Marine Supplies Expenses 2,992,384 3,145,209
Textbooks and Instructional Materials Expenses 1,788,248 1,122,188
Military, Police and Traffic Supplies Expenses 1,115,668 1,258,351
Chemical and Filtering Supplies Expenses 90,108 98,164
198
2016
2017
(in thousand pesos)
Semi-Expendable Machinery and Equipment
Expenses 1,876,434 1,205,550
Semi-Expendable Furniture, Fixtures and Books
Expenses 1,169,068 844,460
Other Supplies and Materials Expenses 11,643,974 10,805,321
Total 69,669,031 60,177,324
Expenses in this group of accounts were topped by DOH-OSEC, DepEd-

OSEC and DILG-PNP amounting to P12.99 billion, P12.29 billion, and
P5.88 billion, respectively. The departments/offices with their
corresponding expenses for supplies and materials are as follows:
Amount Percent
Department/Office
Health 13,013,099 18.68
Education 12,314,302 17.68
Sub-total 62,040,499 89.05
Total 69,669,031 100.00
35.4. Utility Expenses
Utility expenses totalling P14.30 billion represented 4.73 percent of the

2016
2017
(in thousand pesos)
Water Expenses 2,842,662 2,592,717
Electricity Expenses 11,443,839 10,281,269
Gas/Heating Expenses 6,359 4,200
Other Utility Expenses 7,095 477
Total 14,299,955 12,878,663
Total utility expenses was incurred by the following departments/offices:
199
Amount Percent
Department/Office
Education 2,851,197 19.94
Health 1,491,039 10.43
Finance 447,075 3.13
Sub-total 11,713,069 77.64
Total 14,299,955 100.00
35.5. Communication Expenses
Communication expenses totalling P4.64 billion represented 1.54 percent

of the total MOOE. This group of accounts posted an increase of P283.95
million or 6.51 percent from previous year’s total of P4.36 billion. The
comparative details are as follows:
2016
2017
(in thousand pesos)
Postage and Courier Services 388,120 354,336
Telephone Expenses 2,266,442 2,114,061
Internet Subscription Expenses 1,770,644 1,666,117
Cable, Satellite, Telegraph and Radio Expenses 219,417 226,160
Total 4,644,623 4,360,674
Total communication expenses was incurred by the following

Amount Percent
Department/Office
Education 826,257 17.79
Health 206,165 4.44
Finance 152,254 3.28
Sub-total 3,167,218 68.19
Total 4,644,623 100.00
200
35.6. Awards/Rewards and Prizes
Awards/Rewards and Prizes totalling P758.62 million represented 0.25

percent of the total MOOE. This group of accounts posted an increase of
P88.20 million or 13.16 percent from previous year of P670.42 million. The
comparative details are as follows:
2016
2017
(in thousand pesos)
Awards/Rewards Expenses 521,042 531,759
Prizes 237,255 137,883
Indemnities 319 772
Total 758,616 670,415
Total awards/rewards and prizes was incurred by the following

Amount Percent
Department/Office
Health 34,834 4.59
Justice 13,175 1.74
Sub-total 736,798 97.12
Total 758,616 100.00
35.7. Survey, Research, Exploration and Development Expenses
Survey, research, exploration and development expenses totalling P989.29

million represented 0.33 percent of the total MOOE. This group of accounts
posted an increase of P79.60 million or 8.75 percent from previous year’s
total of P909.69 million. The comparative details are as follows:
2016
2017
(in thousand pesos)
Survey Expenses 650,725 679,316
Research, Exploration and Development Expenses 338,563 230,373
Total 989,288 909,689
Total survey, research, exploration and development expenses was incurred

201
Amount Percent
Department/Office
National Economic and Development Authority 60,064 6.07
Health 2,356 0.24
Sub-total 986,131 99.68
Total 989,288 100.00
35.8. Demolition/Relocation and Desilting/Dredging Expenses
Demolition/relocation and desilting/dredging expenses totalling P63.86

million represented 0.02 percent of the total MOOE. This group of accounts
posted an increase of P30.99 million or 94.30 percent from FY 2016 total
of P32.87 million. The comparative details are as follows:
2016
2017
(in thousand pesos)
Demolition and Relocation Expenses 18,359 15,667
Desilting and Dredging Expenses 45,503 17,200
Total 63,862 32,867
Demolition/relocation and desilting/dredging expense was incurred by the

Amount Percent
Department/Office
Metro Manila Development Authority 31,426 49.21
Education 717 1.12
Total 63,862 100.00
35.9. Generation, Transmission and Distribution Expenses
Generation, transmission and distribution expenses totalling P7.96 million

represented 0.003 percent of the total MOOE. This account posted a
decrease of P6.55 million or 45.16 percent from previous year’s total of
P14.51 million. MSU-Marawi was the only agency which reported this
expense.
202
35.10. Confidential, Intelligence and Extraordinary Expenses
Confidential, intelligence and extraordinary expenses totalling P8.98

billion represented 2.97 percent of the total MOOE. This group of accounts
posted an increase of P4.52 billion or 101.78 percent from previous year of
P4.44 billion. The comparative details are as follows:
2016
2017
(in thousand pesos)
Confidential Expenses 1,998,470 803,353
Intelligence Expenses 4,402,932 1,093,214
Extraordinary and Miscellaneous Expenses 2,565,971 2,547,544
Total 8,967,373 4,444,111
Total confidential, intelligence and extraordinary expenses was incurred by

Amount Percent
Department/Office
Congress of the Philippines 1,797,303 20.04
Justice 346,372 3.86
Finance 77,243 0.86
Sub-total 8,665,740 96.64
Total 8,967,373 100.00
35.11. Professional Services
This group of accounts aggregating P31.11 billion or 10.30 percent was the
third major component of MOOE. This account posted an increase of P7.94
billion or 34.25 percent from previous year’s total of P23.18 billion. The
overall increase was due to significant increases in consultancy services
and other professional services. The comparative details are as follows:
2016
2017
(in thousand pesos)
Legal Services 317,577 206,281
Auditing Services 77,656 71,519
Consultancy Services 6,726,780 3,091,482
Other Professional Services 23,991,645 19,806,795
Total 31,113,658 23,176,078
203
The total professional services was incurred by the following
Amount Percent
Department/Office
Health 9,084,386 29.20
Finance 687,957 2.21
Sub-total 26,293,688 84.51
Total 31,113,658 100.00
35.12. General Services
General services totalling P15.03 billion represented 4.97 percent of the

2016
2017
(in thousand pesos)
Environment/Sanitary Services 1,859,726 1,889,957
Janitorial Services 2,928,962 2,603,611
Security Services 4,697,924 4,219,565
Other General Services 5,543,258 4,815,253
Total 15,029,871 13,528,385
Total general services was incurred by the following departments/offices:
Amount Percent
Department/Office
Education 1,891,183 12.58
Metro Manila Development Authority 1,811,327 12.05
Health 1,309,458 8.71
National Economic and Development Authority 618,554 4.12
Finance 570,369 3.79
Sub-total 10,918,938 72.65
Total 15,029,871 100.00
204
35.13. Repairs and Maintenance
Total repairs and maintenance of P26.96 billion was higher by P1.92 billion
or 7.66 percent than previous year’s total of P25.04 billion. This was mainly
due to the increase in repairs and maintenance of infrastructures assets, and
building and other structures of P1.62 billion and P780.92 million,
respectively. The comparative details of repairs and maintenance expenses
are as follows:
2016
2017
(in thousand pesos)
Repairs and Maintenance-Investment Property 2,184 871
Repairs and Maintenance-Land Improvements 126,949 156,638
Repairs and Maintenance-Infrastructure Assets 9,547,097 7,922,384
Repairs and Maintenance-Buildings and Other
Structures 10,027,370 9,246,455
Repairs and Maintenance-Machinery and
Equipment 2,675,181 2,515,062
Repairs and Maintenance-Transportation
Equipment 4,255,465 4,915,195
Repairs and Maintenance-Furniture and Fixtures 163,934 159,437
Repairs and Maintenance-Leased Assets 26,032 12,090
Repairs and Maintenance-Leased Assets
Improvements 25,095 26,416
Restoration and Maintenance-Heritage Assets 2,729 2,536
Repairs and Maintenance-Semi-Expendable
Machinery and Equipment 20,982 5,805
Repairs and Maintenance-Semi-Expendable
Furniture, Fixtures and Books 10,666 15,244
Repairs and Maintenance-Other Property, Plant
and Equipment 71,375 59,705
Total 26,955,059 25,037,838
The total repairs and maintenance was incurred by the following

Amount Percent
Department/Office
Education 5,158,727 19.14
Finance 799,623 2.97
Sub-total 25,074,380 93.02
Total 26,955,059 100.00
205
35.14. Other Maintenance and Operating Expenses
This group of accounts totalling P63.55 billion or 21.03 percent

representing the second major component of MOOE was higher by P17.43
billion or 37.79 percent from previous year of P46.12 billion. The increase
resulted from substantial increases in donations, rent/lease expenses,
representation expenses, and other maintenance and operating expenses.
The comparative details of other maintenance and operating expenses are
as follows:
2016
2017
(in thousand pesos)
Advertising Expenses 1,505,258 920,138
Printing and Publication Expenses 1,918,223 1,857,197
Representation Expenses 7,614,974 4,495,337
Transportation and Delivery Expenses 682,983 693,567
Rent/Lease Expenses 12,534,676 8,486,505
Membership Dues and Contributions to
Organizations 1,740,659 1,768,889
Subscription Expenses 820,295 395,201
Donations 15,657,580 10,518,611
Litigation/Acquired Assets Expenses 30,803 37,011
Loss on Guaranty 994,919 960,800
Other Maintenance and Operating Expenses 20,047,486 15,985,010
Total 63,547,855 46,118,265
The OP, DA-OSEC, and DOT-OSEC were the leading spenders, with
P8.19 billion, P4.68 billion, and P4.58 billion, respectively. The total other
MOOE was incurred by the following departments/offices:
Amount Percent
Department/Office
Health 4,200,615 6.61
Education 4,095,711 6.45
Finance 4,077,758 6.42
Sub-total 46,562,711 73.27
Total 63,547,855 100.00
36. FINANCIAL EXPENSES
Total financial expenses of P325.20 billion, which represented 21.15 percent of the
total current operating expenses, was higher by P9.40 billion or 2.98 percent
206
compared to previous year of P315.80 billion.
Of the total amount of P325.20 billion, the DOF accounted for P324.69 billion or
99.84 percent, of which P323.77 billion or 99.72 percent was incurred by the BTr-
NG mostly on interest expenses. The details of financial expenses are as follows:

Particulars
(in thousand pesos)
Management Supervision/Trusteeship Fees 496 9,025
Interest Expenses 323,349,088 313,631,722
Guarantee Fees 544 -
Bank Charges 1,155,589 1,220,872
Commitment Fees 189,164 150,233
Other Financial Charges 506,408 785,515
Total 325,201,289 315,797,366
37. NON-CASH EXPENSES
The total non-cash expenses of P78.43 billion, which represented 5.10 percent of
the total current operating expenses, was higher by P7.66 billion or 10.83 percent
than FY 2016 of P70.77 billion. The details are as follows:

Particulars
(in thousand pesos)
Depreciation 73,751,864 66,422,987
Amortization 845,864 203,384
Impairment Loss 3,343,153 3,986,944
Losses 488,818 153,627
Total 78,429,699 70,766,942
By department/office, the total non-cash expenses was distributed as follows:
Amount Percent
Department/Office
Education 5,359,379 6.83
Health 2,590,335 3.30
Finance 2,058,727 2.62
Sub-total 73,688,488 93.95
Total 78,429,699 100.00
207
37.1. Depreciation
Total depreciation expense for FY 2017 posted an increase of P7.33 billion

or 11.03 percent compared to FY 2016 of P66.42 billion, mostly due to the
increase in the depreciation of infrastructure assets of P5.11 billion.
The top components of depreciation were the following: infrastructure

assets of P45.08 billion or 61.13 percent, machinery and equipment of
P12.37 billion or 16.77 percent, buildings and other structures of P7.13
billion or 9.66 percent, and transportation equipment of P6.02 billion or
8.17 percent. The breakdown of depreciation expenses is shown in the
following table:
2016
2017
(in thousand pesos)
Depreciation-Investment Property 9,221 11,275
Depreciation-Land Improvements 349,686 356,753
Depreciation-Infrastructure Assets 45,084,375 39,972,530
Depreciation-Buildings and Other Structures 7,125,699 6,784,400
Depreciation-Machinery and Equipment 12,369,989 11,066,517
Depreciation-Transportation Equipment 6,023,788 5,322,755
Depreciation-Furniture, Fixtures and Books 763,057 875,250
Depreciation-Leased Assets 91,513 66,409
Depreciation-Leased Assets Improvements 28,999 36,488
Depreciation-Heritage Assets 2,662 8,042
Depreciation-Service Concession Assets 1,545,220 1,545,177
Depreciation-Other Property, Plant and Equipment 357,655 377,389
Total 73,751,864 66,422,987
The top five departments with big amounts of depreciation expenses are:
DPWH – P45.51 billion or 61.70 percent; DND – P6.93 billion or 9.40
percent; DepEd – P4.90 billion or 6.64 percent; SUCs – P3.65 or 4.95
percent; and DOH – P2.56 billion or 3.47 percent.
37.2. Amortization
Total amortization of P845.86 million or 1.08 percent of the total non-cash

expenses pertained to amortization of intangible assets such as
patents/copyrights, computer software, websites and other intangible
assets. The top three departments with highest amounts of amortization are:
DepEd – P460.27 million or 54.41 percent; DPWH – P146.77 million or
17.35 percent; and The Judiciary – P82.49 million or 9.75 percent.
DepEd-OSEC amortization increased significantly by P460.13 million due

to increase in the amount of computer software.
208
37.3. Impairment Loss
Total impairment loss for FY 2017 registered a decrease of P643.79 million

or 16.15 percent from FY 2016 of P3.99 billion. The comparative details of
impairment loss are as follows:
2016
2017
(in thousand pesos)
Impairment Loss-Financial Assets Held to
Maturity - 6,238
Impairment Loss-Loans and Receivables ,027,424 664,806
Impairment Loss-Lease Receivables 14 16
Impairment Loss-Other Receivables 990,824 3,119,838
Impairment Loss-Inventories 12,874 -
Impairment Loss-Investment Property - 128
Impairment Loss-Property, Plant and Equipment 267,544 173,047
Impairment Loss-Biological Assets 1,076 243
Impairment Loss-Intangible Assets 16,082 130
Impairment Loss-Other Assets 27,316 22,497
Total 3,343,153 3,986,944
The top three departments/offices with big amounts of impairment loss are:
DA – P1.51 billion or 45.09 percent, DOF – P1.37 billion or 40.99 percent,
and DND – P159 million or 4.76 percent.
37.4. Losses
Details of losses, all pertaining to biological assets, are as follows:
2016
2017
(in thousand pesos)
Loss on Sale of Biological Assets 9,655 1,521
Loss on Sale of Agricultural Produce - 19
Loss on Initial Recognition of Biological Assets 5 -
Loss from Changes in Fair Value Less Costs to
Sell of Biological Assets Due to Physical
Change 478,822 152,060
Loss from Changes in Fair Value Less Costs to
Sell of Biological Assets Due to Price Change 337 26
Total 488,818 153,627
Of the total losses, P487.48 million or 99.73 percent was incurred by the
DA-PCC.
38. NET FINANCIAL ASSISTANCE/SUBSIDY
The negative balance of P802.51 billion in net financial assistance/subsidy is the

difference between the financial assistance/subsidy from NGAs, LGUs, and
GOCCs of P3.29 billion and financial assistance/subsidy to NGAs, LGUs, GOCCs,
209
and NGOs/POs of P805.80 billion. FY 2017 negative balance was higher by
P69.74 billion than previous year’s negative balance of P732.77 billion. The
comparative data are as follows:
2016
2017
(in thousand pesos)
Financial Assistance/Subsidy from NGAs, LGUs and
GOCCs
Assistance from Local Government Units 3,286,118 3,252,671
Assistance from Government-Owned or Controlled
Corporations 4,384 32,557
Total 3,290,501 3,285,227
Less: Financial Assistance/Subsidy to NGAs, LGUs,
GOCCs and NGOs/POs
Subsidy to NGAs 203,639 10,431,516
Financial Assistance to Local Government Units 50,988,269 48,861,287
Budgetary Support to Government-Owned or Controlled
Corporations 133,700,972 135,043,592
Financial Assistance to NGOs/POs 539,115 478,311
Internal Revenue Allotment 486,883,083 428,617,582
Subsidies-Others 133,480,572 112,623,035
Total 805,795,650 736,055,322
Net Financial Assistance/Subsidy (802,505,149) (732,770,094)
For purposes of FS consolidation, the following financial assistance and subsidy

from and to accounts were eliminated as follows:
2016
2017
(in thousand pesos)
Financial Assistance/Subsidy from NGAs, LGUs and
GOCCs
Subsidy from National Government 2,523,084,117 2,073,881,103
Subsidy from Other National Government Agencies 20,627,167 17,129,119
Subsidy from Other Funds 687,342 2,447,154
Subsidy from Central Office 36,746,311 32,179,254
Subsidy from Regional Office/Staff Bureaus 3,033,810 519,782
Total 2,584,178,747 2,126,156,411
Less: Financial Assistance/Subsidy to NGAs, LGUs,
GOCCs and NGOs /POs
Subsidy to NGAs 2,523,084,117 2,073,881,103
Financial Assistance to NGAs 9,611,354 18,145,371
Subsidy to Regional Offices/Staff Bureaus 18,979,337 27,035,524
Subsidy to Operating Units 26,084,026 15,602,023
Subsidy to Other Funds 21,936 267,668
Subsidies-Others 6,397,977 (8,775,278)
Total 2,584,178,747 2,126,156,411
Net Financial Assistance/Subsidy - -
210
38.1. Financial Assistance/Subsidy from NGAs, LGUs and GOCCs
a. Assistance from Local Government Units
FY 2017 Assistance from LGUs of P3.29 billion was higher by P33.45

million or 1.03 percent than previous year of P3.25 billion. Of this
amount, P3.11 billion or 94.67 percent was reported by MMDA. This
represented the amount withheld by the DBM from the IRA of NCR
LGUs and released to the MMDA for its operational use pursuant to
R.A. No. 7924, an act creating the MMDA. The departments/offices
which received financial assistance from LGUs are as follows:
Amount Percent
Department/Office
Metro Manila Development Authority 3,110,954 94.67
Health 26,703 0.81
Total 3,286,118 100.00
b. Assistance from Government-Owned or Controlled

Corporations
GOCCs’ assistance of P4.38 million was lower by P28.17 million or

86.54 percent than previous year’s amount of P32.56 million. FY 2017
recipients of financial assistance from GOCCs are PCOO-OSEC and
DepEd amounting to P3.45 million and P933.50 thousand, respectively.
The assistance received by PCOO-OSEC from PAGCOR were
supplemental funds for the production of photo of President Rodrigo
Duterte.
38.2. Financial Assistance/Subsidy to NGAs, LGUs, GOCCs and NGOs/POs
a. Subsidy to NGAs
Subsidy to NGAs account is used by the BTr to recognize

replenishments made to AGDBs for negotiated MDS checks and other
payments on accounts of NGAs. After the elimination of Subsidy to
NGAs, this account had a balance of P203.64 million, representing the
replenishment of MDS checks issued by NGAs in FY 2016 but
presented for encashment only in FY 2017.
211
b. Financial Assistance to Local Government Units
Financial Assistance to LGUs totalled to P50.99 billion, an increase of

P2.13 billion or 4.35 percent from previous year’s P48.86 billion.
The Financial Assistance to LGUs reported by DOF BTr-NG at P42.90

billion consisted of special shares of LGUs from the proceeds of
National Taxes – P3.92 billion, Local Government Support Fund –
P38.95 billion, and Pension and Gratuity Fund – P21.13 million.
The departments/offices which reported Financial Assistance to LGUs

were as follows:
Amount Percent
Department/Office
Finance-BTr NG 42,898,707 84.13
Health 4,418,890 8.67
Autonomous Region in Muslim Mindanao–
Office of the Regional Governor 14,350 0.03
Tourism 4,815 0.01
Total 50,988,269 100.00
c. Budgetary Support to Government-Owned or

Controlled Corporations
Budgetary support to GOCCs aggregated to P133.70 billion, a decrease

of P1.34 billion or 0.99 percent from previous year’s total of P135.04
billion. The departments/offices which reported budgetary support to
GOCCs were as follows:
Amount Percent
Department/Office
Finance-BTr NG 131,077,677 98.04
Health 2,405,707 1.80
Tourism 45,577 0.03
Other Executive Offices-National Commission
for Culture and the Arts-Proper 1,010 0.00
Education 110 0.00
Total 133,700,972 100.00
212
The details of budgetary support of P131.08 billion to 39 GOCCs
reported by the DOF-BTr NG are as follows:
Amount
Percent
Particulars (in thousand
to Total
pesos)
1. Philippine Health Insurance Corporation 47,190,663 36.00
2. National Irrigation Administration 30,141,824 23.00
3. National Housing Authority 19,557,279 14.92
4. National Food Authority 5,105,468 3.89
5. Manila International Airport Authority 3,609,522 2.75
6. Philippine Economic Zone Authority 2,805,266 2.14
7. Philippine Crop Insurance Corporation 2,500,000 1.91
8. Subic Bay Metropolitan Authority 2,173,951 1.66
9. National Electrification Administration 2,050,736 1.56
10. Bases Conversion and Development Authority 1,350,590 1.03
11. Philippine Coconut Authority 1,324,117 1.01
12. Social Housing Finance Corporation 1,246,205 0.95
13. National Power Corporation 1,191,680 0.91
14. Sugar Regulatory Administration 1,136,211 0.87
15. Local Water Utilities Administration 1,000,801 0.76
16. National Home Mortgage Finance Corporation 1,000,000 0.76
17. Small Business Guarantee and Finance
Corporation 936,778 0.71
18. Light Rail Transit 819,389 0.63
19. Philippine Children’s Medical Center 676,936 0.52
20. Philippine Heart Center 613,594 0.47
21. Philippine Rice Research Institute 561,000 0.43
22. Social Security System 541,076 0.41
23. Philippine Postal Corporation 536,537 0.41
24. Philippine National Railways 516,491 0.39
25. National Kidney and Transplant Institute 468,089 0.36
26. Cultural Center of the Philippines 320,365 0.24
27. Development Academy of the Philippines 285,262 0.22
28. Lung Center of the Philippines 265,190 0.20
29. Center for International Trade Expositions &
Mission 220,000 0.17
30. National Dairy Authority 199,945 0.15
31. Philippine Institute for Development Studies 163,537 0.12
32. People’s Television Network Incorporated 137,975 0.11
33. Philippine Institute of Traditional &
Alternative Health Care 109,539 0.08
34. Philippine Fisheries Development Authority 98,284 0.07
35. Zamboanga City Special Economic Zone
36. Credit Information Corporation 47,574 0.04
37. Philippine Center for Economic Development 44,745 0.03
38. Southern Philippines Development Authority 41,058 0.03
39. Aurora Pacific Economic Zone & Freeport
Total 131,077,677 100.00
d. Financial Assistance to NGOs/POs
Financial Assistance to NGOs/POs increased by P60.80 million or
213
12.71 percent from previous year’s amount of P478.31 million. OEO-
NCCA reported the highest amount of P140.36 million or 26.03
percent, followed by DepEd-OSEC and DA with amounts of P104.72
million or 19.42 percent, and P78.99 million or 14.65 percent,
respectively.
e. Internal Revenue Allotment
IRA is the annual share of LGUs from national internal revenue taxes.
Section 85 of the General Provisions of FY 2017 GAA provides that
IRA and all LGU shares appropriated therein shall be directly released
by the DOF-BTr to the LGU beneficiaries through AGDBs. For FY
2017, the DOF-BTr NG reported a total of P486.88 billion IRA for
LGUs.
f. Subsidies-Others
This account refers to the financial assistance given to individuals and

institutions other than government agencies or NGOs/POs for
implementation of government programs/projects/activities. FY 2017
total Subsidies-Others of P133.48 billion was P20.86 billion or 18.52
percent higher than previous year of P112.62 billion. DSWD-OSEC
reported P108.67 billion or 81.42 percent, consisting of cash grants for
4Ps beneficiaries.
39. NON-OPERATING INCOME/GAINS
This group of accounts is broken down as follows:

Particulars
(in thousand pesos)
Sale of Assets
Sale of Garnished/Confiscated/Abandoned/
Seized Goods and Property 294,618 665,013
Sale of Unserviceable Property 8,067 52,451
Sub-Total 302,686 717,464
Gains and Reversal
Gain on Foreign Exchange (FOREX) 7,210,892 14,270,743
Gain on Sale of Investments 1,367,088 1,386,736
Gain on Sale of Property, Plant and Equipment 4,825 6,574
Other Gains 1,290,697 355,408
Reversal of Impairment Loss 1,293 324
Sub-Total 9,874,794 16,019,785
Total 10,177,480 16,737,249
39.1. Sale of Assets
Total sale of assets of P302.69 million decreased by P414.78 million or

57.81 percent compared to previous year’s amount of P717.46 million. Of
the total sale of garnished/confiscated/abandoned/seized goods and
214
property of P294.62 million, P273.68 million or 92.89 percent was reported
by DOF-BOC.
39.2. Gains
Total gains of P9.87 billion went down by P6.14 billion or 38.36 percent
from previous year’s amount of P16.02 billion due to decrease of gain on
foreign exchange (FOREX) by P7.06 billion or 49.47 percent from
previous year’s total of P14.27 billion.
The DOF-BTr NG reported substantial amount for the following accounts:

Gain on Foreign Exchange (FOREX) – P6.63 billion or 91.91 percent, Gain
on Sale of Investments – P1.37 billion, and Other Gains – P1.11 billion or
86.20 percent.
The departments/offices which reported other gains amounting to P1.29

billion are as follows:
Amount Percent
Department/Office
Finance 1,114,592 86.36
Justice 41,536 3.22
Health 21,058 1.63
Sub-total 1,280,980 99.25
Total 1,290,697 100.00
40. LOSSES
The details of non-operating losses of P38.06 billion were as follows:

Particulars
(in thousand pesos)
Loss on Foreign Exchange (FOREX) 33,694,023 75,905,938
Loss on Sale of Investments 53,152 564,955
Loss on Sale of Property, Plant and Equipment 77,874 92,470
Loss on Sale of Assets 21,097 7,068
Loss of Assets 634,226 269,214
Other Losses 3,584,024 19,486
Total 38,064,397 76,859,131
Of the total loss on foreign exchange (FOREX) of P33.69 billion, P33.14 billion
or 98.37 percent was recognized by DOF-BTr NG. The departments/offices which
215
reported other losses amounting to P3.58 billion are as follows:
Amount Percent
Department/Office
Finance 3,564,355 99.45
Health 8,766 0.24
Education 333 0.01
Sub-total 3,583,913 100.00
Total 3,584,024 100.00
41. SURPLUS/DEFICIT FOR THE PERIOD
For FY 2017, NG’s surplus from operations soared to P155.77 billion, a

remarkable increase of P114.51 billion or 277.59 percent compared to previous
year’s surplus of P41.25 billion. The details are as follows:

Particulars
(in thousand pesos)
Revenue 2,523,594,139 2,229,816,102
Less: Current Operating Expenses 1,537,436,651 1,395,671,567
Surplus/(Deficit) Before Other Income/Expense
Items 986,157,488 834,144,535
Other Income/Expense Items
Net Financial Assistance, Subsidy From/To NGAs (203,639) (10,431,516)
Net Assistance From/To LGUs, GOCCs, NGOs
and Subsidy from Other Funds (802,301,509) (722,338,579)
Sale of Assets 302,686 717,464
Net Gain/(Loss) (28,189,603) (60,839,345)
Sub-Total (830,392,066) (792,891,976)
Surplus/(Deficit) for the Period 155,765,422 41,252,559
42. CHANGES IN NET ASSETS/EQUITY
The Statement of Changes in Net Assets/Equity of the NG as at December 31, 2017

shows the following:
2016
2017
(in thousand pesos)
Balance at January 1 (1,935,204,805) (1,564,181,676)
Add/(Deduct):
Changes in Accounting Policy - (1,537,639)
Prior Period Errors - (178,451,199)
Other Adjustments - (45,570,723)
Restated Balance (1,935,204,805) (1,789,741,237)
216
2016
2017
(in thousand pesos)
Add/(Deduct):
Changes in Net Assets/Equity for the Fiscal Year
Surplus/(Deficit) for the Period 155,765,422 41,252,559
Adjustment of Net Revenue recognized directly
in Net Assets/Equity (4,024,202) (12,782,810)
Others (97,672,623) (173,933,317)
Balance at December 31 (1,881,136,208) (1,935,204,805)
42.1. Balance at January 1, 2017
The negative beginning balance of net assets/equity of P1.935 trillion is the

restated ending balance as at December 31, 2016. This restated balance
excludes the accounts of: 1) Commission on Elections (COMELEC) which
did not submit FSs for FY 2017, and 2) Tourism Promotions Board of the
DOT with balances in the Special Account in the General Fund but were
not accounted separately from the Corporate Fund and were reported in the
AFR for GCs; but includes the accounts of Overseas Workers Welfare
Administration which is now an attached agency of the Department of
Labor and Employment pursuant to R.A. No. 10801.
42.2. Changes in Net Assets/Equity for the Fiscal Year
a. Surplus/(Deficit) for the Period
This refers to the surplus of P155.77 billion as a result of operations of

the NGAs that submitted their FSs for FY 2017 as reflected in the SFPer
which was closed to the Accumulated Surplus/(Deficit) account at the
end of the year. The following departments/offices reported
surpluses/deficits from operations, as follows:
Amount Percent
Department/Office
Health 31,300,316 4.75
Energy 21,588,906 3.28
Education 19,021,031 2.89
Justice 15,270,591 2.32
Sub-total 659,098,868 100.00
Finance (502,766,297) 99.88
Office of the President (566,985) 0.11
Joint Legislative-Executive Councils (164) 0.01
Sub-total (503,333,446) 100.00
Total 155,765,422
217
b. Adjustment of Net Revenue Recognized Directly in
Net Assets/Equity
This refers to the closing adjustments of Cash-Treasury/Agency

Deposit-Regular and Special Account for revenue collected by the
agencies and remitted to the National Treasury. This also includes the
closing of Cash-Tax Remittance Advice and Cash-Constructive Income
Remittance for the constructive receipt, and remittance of taxes through
Tax Remittance Advice and constructive receipt of income by the BTr
from collections made by Foreign Service Posts of the DFA,
respectively, as follows:
Amount
Particulars
(in thousand pesos)
Closing of Cash-Treasury/Agency Deposit-Regular (10,362,630)
Closing of Cash-Treasury/Agency Deposit-Special
Account (528,489)
Closing of Cash-Tax Remittance Advice 6,953,545
Closing of Cash-Constructive Income Remittance (86,628)
Total Adjustment of Net Revenue (4,024,202)
c. Others
Others refer to other adjustments of negative P97.67 billion, which

substantially affected the balance of net assets/equity as at year-end.
The following departments/offices reported significant positive and
negative other adjustments, as follows:
Amount Percent
Department/Office
Positive Adjustments
Sub-Total 69,142,065 100.00
Negative Adjustments
Public Works and Highways (105,020,437) 62.96
Finance (17,306,359) 10.37
Health (14,020,047) 8.40
Agriculture (9,458,684) 5.67
Justice (5,565,787) 3.34
Other Departments/Offices (15,443,374) 9.26
Sub-Total (166,814,688) 100.00
Net Other Adjustments (97,672,623)
42.3. Balance at December 31, 2017
The negative ending balance of P1.881 trillion represents the cumulative

net deficit of the NG as at December 31, 2017 after considering the restated
218
ending balance of FY 2016 and the changes in equity as a result of the
operations of the NG for FY 2017.
43. CASH INFLOWS FROM OPERATING ACTIVITIES
The cash inflows from operating activities of P2.636 trillion were from the
following transactions:

Particulars
(in thousand pesos)
Collection of Income/Revenue 2,467,137,319 2,190,303,714
Receipt of Assistance and Subsidy from Other
NGAs, LGUs and GOCCs 5,069,803 4,398,210
Collection of Receivables 52,328,653 41,566,084
Receipt of Inter-Agency Fund Transfers 22,283,151 19,690,739
Trust Receipts 70,601,649 55,720,608
Other Receipts 14,115,278 28,964,882
Total Cash Inflows 2,631,535,852 2,340,644,238
Adjustments 4,867,970 4,394,386
Adjusted Cash Inflows 2,636,403,822 2,345,038,624
Of the P2.467 trillion collection of income/revenue, which was 93.58 percent of

the total cash inflows from operating activities, BIR and BOC, the top revenue-
generating agencies of NG, posted the biggest share of collections of P1.782 trillion
or 72.22 percent and P467.82 billion or 18.96 percent, respectively.
The departments/offices which reported collection of income/revenue are as

follows:
Amount Percent
Department/Office
Finance 2,324,516,272 94.22
Energy 21,654,774 0.88
Justice 14,837,344 0.60
Health 13,942,023 0.57
Information and Communication Technology 4,815,450 0.20
Sub-total 2,438,951,400 98.86
Total 2,467,137,319 100.00
The following adjustments made by agencies increased the balance of cash inflows
from operating activities by P4.87 billion:
219
Particulars
(in thousand pesos)
Restoration of cash for cancelled/lost/stale
checks/ADA 2,525,504 2,854,891
Restoration of cash for unreleased checks (for
commercial checks only) 2,342,466 1,539,496
Total 4,867,970 4,394,386
44. CASH OUTFLOWS FROM OPERATING ACTIVITIES
The total cash outflows from operating activities of P2.274 trillion is detailed as
follows:
2016
2017
(in thousand pesos)
Payment of Expenses 742,730,021 699,073,430
Purchase of Inventories 43,418,790 31,752,507
Purchase of Consumable Biological Assets 167,637 1,987,687
Grant of Cash Advances 74,666,796 64,476,587
Prepayments 9,083,879 5,904,494
Refund of Deposits 31,174,818 41,613,456
Payment of Accounts Payable 82,209,943 57,938,604
Mandatory Deductions 258,483,995 267,856,904
Grant of Financial Assistance/Subsidy 773,392,383 630,014,030
Release of Inter-Agency Fund Transfers 100,939,335 85,973,558
Other Disbursements 109,114,351 47,368,376
Total Cash Outflows 2,225,381,947 1,933,959,632
Adjustments 48,150,544 126,858,095
Adjusted Cash Outflows 2,273,532,491 2,060,817,728
Of the total cash outflows, grant of financial assistance/subsidy posted the highest
amount of P773.39 billion or 34.02 percent. Of this amount, P661.16 billion or
85.49 percent was reported by the DOF, P83.15 billion or 10.75 percent by the
DSWD-OSEC, and the remaining P29.08 billion or 3.76 percent by the other
departments/agencies. The financial assistance granted by the DOF includes a total
of P660.88 billion disbursed by the BTr NG for the IRA of LGUs, budgetary
support to GOCCs and financial assistance to LGUs.
Payment of expenses of P742.73 billion or 32.67 percent represented the second

highest component of cash outflows from operating activities. The payment of
expenses by department/office are as follows:
Amount Percent
Department/Office
Education 255,814,089 34.44
Health 48,471,747 6.53
220
Amount Percent
Department/Office
Judiciary 15,910,988 2.14
Sub-total 618,224,279 83.24
Total 742,730,021 100.00
The following adjustments made by agencies increased the balance of cash

outflows from operating activities by P48.15 billion:

Particulars
(in thousand pesos)
Adjustment for dishonored checks 130,635 70,078
Adjustment for cash shortage 5,971 263,086
Reversing entry for unreleased checks in the
previous year (for commercial checks only) 3,464,399 5,045,147
Other adjustments-outflow 44,549,538 121,479,784
Total 48,150,544 126,858,095
The cash activities eliminated in the Consolidated Statement of Cash Flows under
the operating activities are as follows:

Particulars
(in thousand pesos)
Cash Inflows
Receipt of Notice of Cash Allocation 2,216,757,611 1,892,318,802
Remittance from NGAs (for BTr NG Books only) 2,246,592,288 1,968,362,208
Receipt of Assistance and Subsidy and from Other
NGAs, LGUs and GOCCs 12,219,276 7,702,794
Receipt of Inter-Agency Fund Transfers 18,983,663 17,798,124
Receipt of Intra-Agency Fund Transfers 183,239,441 143,346,796
Adjustments 514,940,493 447,406,104
Total Cash Inflows 5,192,732,771 4,476,934,829
Cash Outflows
Replenishment of negotiated MDS checks (for BTr
NG Books only) (1,733,303,613) (1,542,318,123)
Remittance to National Treasury (2,247,168,142) (2,064,242,375)
Mandatory Deductions (65,923,357) (33,199,739)
Mandatory Deductions (24,503,500) (7,702,794)
Release of Inter-Agency Fund Transfers (19,129,215) (17,798,124)
Release of intra-agency fund transfers (400,993,567) (275,811,101)
Other Disbursements (145,552) (22,241,536)
Reversal of Unutilized NCA (129,303,961) (114,347,405)
Adjustments (572,261,865) (399,273,632)
Total Cash Outflows (5,192,732,771) (4,476,934,829)
Total - -
221
45. CASH INFLOWS FROM INVESTING ACTIVITIES
FY 2017 cash inflows from investing activities increased by P37.71 billion or 26.30
percent over previous year amount of P143.38 billion. The following table shows
the cash inflows from investing activities:
2016
2017
(in thousand pesos)
Proceeds from Sale of Investment Property 11,152 22,219
Proceeds from Sale/Disposal of Property, Plant and
Equipment 25,481 23,766
Sale of Investments 68,843,649 47,661,294
Receipt of Cash Dividends 30,440,502 28,900,822
Proceeds from Matured/Return of Investments 77,038,624 63,871,193
Collection of Long-Term Loans 4,727,651 2,900,273
Proceeds from Sale of Other Assets 5,168 4,231
Total 181,092,227 143,383,797
The DOF-BTr NG reported substantial amount of P156.34 billion or 86.33 percent

of the total cash inflows from investing activities. This was generated from the
following: Sale of investments – P68.69 billion; Proceeds from matured/return of
investments – P54.72 billion; Receipt of cash dividends – P30.41 billion;
Collection of long-term loans – P2.51 billion; Proceeds from sale of investment
property – P10.61 million; and Proceeds from sale/disposal of property, plant and
equipment – P1.47 thousand.
46. CASH OUTFLOWS FROM INVESTING ACTIVITIES
Cash outflows from investing activities amounting to P512.93 billion is composed

of the following:

Particulars
(in thousand pesos)
Purchase/Construction of Investment Property 191,320 26,070
Purchase/Construction of Property, Plant and
Equipment 392,593,408 324,400,981
Investments 115,783,207 44,363,361
Purchase of Bearer Biological Assets 24,563 22,068
Purchase of Intangible Assets 423,871 530,067
Grant of loans 3,909,720 3,332,462
Total 512,926,090 372,675,009
Of the total cash outflows, P338.35 billion or 65.96 percent was reported by DPWH
for its capital expenditures, the entire amount of which was for the
purchase/construction of property, plant and equipment.
Of the P115.78 billion Investments, P91.07 billion or 78.66 percent was reported
by DOF-BTr NG which consisted of P85.71 billion for investment in
stocks/bonds/marketable securities, and P5.36 billion for investment in
222
GOCCs/GFIs.
Grant of loans was reported by the six following departments/offices:
Amount Percent
Department/Office
Education 1,622,197 41.49
Finance 781,508 19.99
Total 3,909,720 100.00
47. CASH INFLOWS FROM FINANCING ACTIVITIES
The DOF, being the agency that manages the public sector’s domestic and foreign
debts, reported the largest amount of cash flows from financing activities.
The cash inflows from this activity amounting to P1.502 trillion were sourced from
the following:

Particulars
(in thousand pesos)
Proceeds from Issuance of Bills and Bonds 1,441,842,234 1,001,423,132
Proceeds from Domestic and Foreign Loans 60,199,924 48,597,541
Total 1,502,042,158 1,050,020,673
Almost 100 percent of the total proceeds was reported by DOF-BTr NG. The cash
received from domestic and foreign loans was net of discount, other financial
charges and documentary stamps but inclusive of premium on bonds, accrued
interests and withholding tax on discounts.
48. CASH OUTFLOWS FROM FINANCING ACTIVITIES
Cash outflows from financing activities of P1.227 trillion resulted from the
following transactions:

Particulars
(in thousand pesos)
Payment of Long-Term Liabilities 64,766,166 68,883,868
Redemption of Bills/Bonds Issued 890,128,918 1,002,049,096
Payment of Interest Expense 271,777,889 269,924,678
Total 1,226,672,973 1,340,857,642
Majority of the cash outflows from financing activities was reported by DOF-BTr
NG, as follows: P64.39 billion for payment of foreign loans; P890.13 billion for
223
redemption of bills and bonds issued; and P271.78 billion for payment of interest
expense.
49. EFFECTS OF EXCHANGE RATE CHANGES ON CASH AND CASH

EQUIVALENTS
The net gain of P363.20 million realized from change in exchange rates during FY
2017 increased the balance of Cash and Cash Equivalents. Of the 11 departments
which reported gains totalling P426.87 million, DFA-OSEC had the highest
amount at P207.67 million or 48.65 percent, followed by DOF at P151.88 million
or 35.58 percent. Four departments, namely: DSWD-OSEC, DENR-OSEC, DND-
OCD and DOH-OSEC incurred losses totalling P63.67 million, of which P60.95
million or 95.73 percent was incurred by DSWD-OSEC.
50. CASH AND CASH EQUIVALENTS
50.1. Beginning Balance
The beginning balance of Cash and Cash Equivalents for FY 2017 was
restated to P559.18 billion from the P565.14 billion ending balance of FY
2016. The decrease of P5.95 billion was due to the adjustments made by
some departments/offices and non-submission by COMELEC of its FSs for
FY 2017. The details of the adjustments are shown in the following table:
Amount
Particulars
(in thousand pesos)
Cash and Cash Equivalents, December 31, 2016 565,135,606
Adjustments: (5,952,279)
Other Executive Offices 2,837,298
Information and Communication Technology 188,399
The Judiciary 134,856
Environment and Natural Resources 1,473
Interior and Local Government 272
Transportation 157
Budget and Management (9)
Tourism (204)
Metropolitan Manila Development Authority (665)
Presidential Communications Operations Office (1,198)
Agriculture (1,903)
Social Welfare and Development (5,339)
Autonomous Region in Muslim Mindanao (6,158)
Education (29,563)
National Economic and Development Authority (30,049)
Trade and Industry (36,113)
Office of the President (37,637)
Finance (42,008)
State Universities and Colleges (88,612)
National Defense (117,701)
Public Works and Highways (425,683)
Science and Technology (439,148)
Labor and Employment (1,494,394)
224
Amount
Particulars
(in thousand pesos)
Health (1,639,170)
Justice (2,139,800)
Commission on Elections (2,579,382)
Cash and Cash Equivalents, December 31, 2016, restated 559,183,327
50.2. Ending Balance
Year-end balance of Cash and Cash Equivalents of P237.33 billion shown

in the Statement of Financial Position was composed of the following
accounts:
Amount
Particulars
(in thousand pesos)
Cash on Hand 2,339,608
Cash in Bank-Local Currency 664,231,747
Cash in Bank-Foreign Currency 42,091,367
Treasury/Agency Cash Accounts (476,926,193)
Cash Equivalent-Treasury Bills 5,595,167
Total 237,331,695
The ending balance of Cash and Cash Equivalents amounting to P865.95

billion shown in the Statement of Cash Flows differed by P628.62 billion
from the balance of P237.33 billion shown in the Statement of Financial
Position. The difference was accounted for as follows: Cash Investment in
Sinking Fund of P77.37 billion was classified under Investment Account;
and Treasury/Agency Cash Accounts totalling P551.25 billion were
presented as negative balances under Cash-Treasury/Agency Deposit
accounts, which pertain to the reciprocal accounts of the deposits of NGAs.
The total difference was recognized in the books of DOF-BTr NG.
51. RECEIPTS
51.1. Original Budgeted Receipts – P2.479 trillion
The original budgeted amount of receipts of P2.479 trillion pertained to the

combined projected revenue/receipts for tax revenue, service and business
income, shares, grants and donations, gains, other non-operating income
and proceeds from domestic and foreign loans submitted by the
departments/offices to the DBM, as presented in the FY 2017 Budget of
Expenditures and Sources of Financing (BESF). The original budgeted
receipts by source and by department/office are shown in Annex B of this
Report.
51.2. Final Budgeted Receipts – P4.011 trillion
The final budgeted amount of receipts of P4.011 trillion was the combined
revenue target as reported in the Quarterly Report of Revenue and Other
225
Receipts or Financial Accountability Report (FAR) No. 5 submitted by
each agency. In case the revenue target was not reflected in FAR No. 5, the
actual collections was considered as the final budgeted amount of receipts.
The final budgeted receipts by source and by department/office are shown
in Annex C.
51.3. Actual Receipts – P3.958 trillion
The actual receipts amounting to P3.958 trillion pertained to the combined

actual collections/receipts by each agency that accrues to the GF and SAGF
as reported in FAR No. 5. The actual receipts by source and by
department/office are shown in Annex D.
51.4. Difference Between the Final Budgeted Receipts and

Actual Receipts – P53.80 billion
The net difference of P53.80 billion between the final budgeted receipts of
P4.011 trillion and actual receipts of P3.958 trillion represented the under
collections for FY 2017 of the departments/offices. The differences
between the final budgeted receipts and actual receipts by source and by
department/office are shown in Annex E.
52. PAYMENTS
52.1. Original Budgeted Payments – P3.604 trillion
The original budgeted payments of P3.604 trillion pertained to the

combined appropriations for PS, MOOE, Financial Expenses (FinEx), and
CO, which included the debt service - principal amortization, of all
departments/offices as reported in the original appropriations column in the
Statement of Appropriations, Allotments, Obligations, Disbursements and
Balances (FAR No. 1) for current year appropriations of FY 2017, and the
not yet due and demandable obligations as reported in FAR No. 1 for FY
2016. The original budgeted payments by allotment class and by
department/office are shown in Annex F.
52.2. Final Budgeted Payments – P3.852 trillion
The final budgeted payments of P3.852 trillion was the combined payments
for PS, MOOE, FinEx, and CO, which included the debt service - principal
amortization, of all departments/offices as reported in adjusted
appropriations column of FAR No. 1 current year and continuing
appropriations. The final budgeted payments by allotment class and by
department/office are shown in Annex G.
52.3. Actual Payments – P2.619 trillion
The actual payments of P2.619 trillion was the combined actual

disbursements for PS, MOOE, FinEx, and CO, which included the debt
226
service - principal amortization of all the departments/offices as reported in
FAR No. 1 current year and continuing appropriations. The actual
payments by allotment class and by department/office are reflected in
Annex H.
52.4. Difference between the Final Budgeted Payments and

Actual Payments – P1.233 trillion
The net difference of P1.233 trillion between the final budgeted payments
of P3.852 trillion and actual payments of P2.619 trillion represented
unutilized final budgeted amount, reflecting a low budget utilization rate of
only 67.99 percent for FY 2017, attributed collectively to unreleased
appropriations, unobligated allotments, and unpaid obligations amounting
to P66.54 billion, P325.98 billion, and P841.46 billion, respectively. The
differences between the final budgeted payments and actual payments by
allotment class and by department/office are presented in Annex I.
53. NET RECEIPTS/PAYMENTS
Under original budgeted amounts, payments exceeded receipts by P1.124 trillion.

Conversely, receipts exceeded payments under the final budgeted amounts by
P159.21 billion. Actual receipts was higher by P1.339 trillion than actual
payments. Net receipts/payments by department/office are shown in Annex J.
227
V. NATIONAL
GOVERNMENT DEBT
PART V – NATIONAL GOVERNMENT DEBT
Introduction
Government borrowing is resorted to in order to finance government operations and to

stabilize the economy when national revenue is insufficient to fund the government's
capital programs and projects. The national government (NG) debt is sourced either from
domestic borrowings or from foreign borrowings. Domestic borrowings consist of
certificates of indebtedness through issuance of treasury bills (T-Bills) and treasury bonds
(T-Bonds) by the Bureau of the Treasury (BTr). Foreign borrowings are funds sourced
from multilateral, bilateral and commercial contracts with external creditors and usually
includes bonds and loans directly contracted and those contracted and relent to government
corporations (GCs).
The long-term debt strategy adopted by the NG was focused on reducing the foreign
currency denominated debt, meeting the government’s financing requirements at minimal
cost consistent with an acceptable level of risk, and supporting the development of local
and domestic market. The NG intends to maintain its preference for domestic funding and
aims to borrow, predominantly in local currency, to meet its funding requirements through
floatation of T-Bills and issuance of T-Bonds.
The NG plans to continue taking advantage of any available concessional loans from
external development partners (DPs) such as Asian Development Bank (ADB),
International Bank for Reconstruction and Development (IBRD), and Japan International
Cooperation Agency (JICA). With the government drive to increase spending for
infrastructure as well as social welfare, the Department of Finance has started to explore
new modes of financing, specifically hybrid financing, which utilizes Official
Development Assistance (ODA) and multilateral agency loans to fund the infrastructure
projects. The government has also begun exploring the issuance of bonds in other
jurisdictions such as the Chinese market and a possible issuance of Samurai bonds in
Japan. These serve to both widen and diversify the investor base of government debt
instruments, taking advantage of natural hedges provided by ODA flows to mitigate
against currency mismatches.
For FY 2017, the government planned to source 75 percent of its funding needs from
domestic sources and 25 percent from foreign lenders. The 2017 turnout reflects an 81:19
split between domestic and external borrowings. Domestic borrowings was still heavily
favored, consistent with the government’s strategy in minimizing foreign exchange risk
and supporting local debt market development.
National Government Outstanding Debts
Outstanding balance of NG Debt of P6.656 trillion as at December 31, 2017 was composed
of domestic borrowings of P4.443 trillion or 66.75 percent and foreign borrowings of
P2.213 trillion or 33.25 percent. Domestic borrowings increased by P506.93 billion or
12.88 percent compared to the FY 2016 amount of P3.936 trillion due to the floatation of
T-Bills and issuance of 5, 7, 10, and 20-year T-Bonds. Foreign borrowings increased by
228
P55.10 billion or 2.55 percent over the previous year’s P2.158 trillion due to the increase
in availment of concessional loans from DPs, and issuance of global bonds in the
international market in February 2017–the first for the Duterte administration. Table V-1
shows the details of comparative outstanding balances of NG Debt for FYs 2017 and 2016.
Table V-1 Comparative Outstanding Balances of National Government Debt
Amount
(in million pesos)
Particulars Percent
Increase
2017 2016
(Decrease)
Domestic 4,442,779.01 3,935,848.95 506,930.06 12.88
Bonds Payable 4,127,617.21 3,647,120.15 480,497.06 13.17
Fixed rate T-Bonds 2,201,710.44 1,852,498.78 349,211.67 18.85
Retail T-Bonds 932,910.08 801,983.32 130,926.76 16.33
Benchmark bonds 909,298.02 909,298.02 - -
On shore 10-year bonds 24,979.00 24,884.50 94.50 0.38
T-Bonds (CB-BOL) 50,000.00 50,000.00 - -
Agrarian reform bonds 8,719.66 8,455.34 264.33 3.13
Domestic certificated/
uncertificated T-Bonds - 0.19 (0.19) -
Treasury Bills 314,369.30 287,936.30 26,433.00 9.18
Central Bank-Board of 174,568.30 174,568.30 - -
Liquidators (CB-BOL)
Regular 139,801.00 113,368.00 26,433.00 23.32
Loans Payable 792.50 792.50 - -
DBP assumed loans 442.50 442.50 - -
PNB assumed loans 350.00 350.00 - -
Foreign 2,212,804.68 2,157,709.65 55,095.02 2.55
Bonds Payable 1,364,059.95 1,341,817.03 22,242.92 1.66
Global bonds 1,321,731.41 1,299,488.50 22,242.92 1.71
Japanese bonds 42,328.53 42,328.53 - -
Loans Payable 848,744.73 815,892.63 32,852.10 4.03
NG direct/relent 848,744.73 815,892.63 32,852.10 4.03
Total 6,655,583.68 6,093,558.60 562,025.08 9.22
BTr reported that the outstanding balance of NG debt amounted to P6.037 trillion as at
December 31, 2016, consisting of Bonds Payable-Domestic – P3.639 trillion, T-Bills –
P287.95 billion, Loans Payable-Domestic – P448.23 million, Bonds Payable-Foreign –
P1.295 trillion, and Loans Payable-Foreign – P815.50 billion. The adjustments to the
accounts pertaining to 2016 transactions amounting to P56.17 billion, composed of
adjustments in Domestic Loans and Bonds Payables of P8.76 billion and in Foreign Loans
and Bonds Payable of P47.40 billion were recognized by the BTr only in 2017. The
computation of the adjusted balances of the accounts as at January 1, 2017, after
considering the adjustments, is presented in Table V-2.
229
Table V-2 Adjusted Outstanding Balance of National Government Debt
Amount
(in million pesos)
Particulars Adjusted
Outstanding as of
Adjustments 2016 Outstanding as of
12/31/16
12/31/16
Domestic 3,927,084.12 8,764.83 3,935,848.95
Bonds Payable 3,638,687.94 8,432.21 3,647,120.15
Treasury Bills 287,947.95 (11.65) 287,936.30
Loans Payable 448.23 344.27 792.50
Foreign 2,110,305.39 47,404.26 2,157,709.65
Bonds Payable 1,294,807.47 47,009.56 1,341,817.03
Loans Payable 815,497.92 394.70 815,892.63
Total 6,037,389.51 56,169.09 6,093,558.60
Domestic Borrowings
The amount of P1.473 trillion was availed during FY 2017 through issuance of T-Bonds
of P735.04 billion and floatation of T-Bills of P737.64 billion. The bonds payable consists
of fixed rate T-Bonds of P550.89 billion, retail T-Bonds of P181.93 billion, and agrarian
reform bonds of P2.21 billion. Domestic borrowings increased by a remarkable amount of
P491.06 billion or 50.03 percent from previous year amount of P981.61 billion. Table V-
3 shows the details of the comparative domestic debt availments and issuances.
Table V-3 Comparative Domestic Debt Availments and Issuances
Amount
(in million pesos)
Particulars Percent
Increase
2017 2016
(Decrease)
Bonds Payable 735,035.50 336,521.16 398,514.33 118.42
Fixed rate T-Bonds 550,894.25 211,772.00 339,122.25 160.14
Retail T-Bonds 181,930.58 100,125.71 81,804.87 81.70
Benchmark bonds - 22,180.00 (22,180.00) -
Agrarian reform bonds 2,210.67 2,443.45 (232.78) (9.53)
Treasury Bills 737,636.30 645,088.30 92,548.00 14.35
CB-BOL 429,568.30 429,568.30 - -
Regular 308,068.00 215,520.00 92,548.00 42.94
Total 1,472,671.80 981,609.46 491,062.33 50.03
T-Bills rolled-over amounting to P429.57 billion were intended for the payment of interest
on the debts of CB-BOL assumed by the NG.
Repayments of domestic borrowings reached P966.10 billion, registering an increase of

P32.64 billion or 3.50 percent from previous year of P933.46 billion. Bonds redeemed in
the amount of P254.90 billion decreased by P56.98 billion or 18.27 percent. T-Bills
redemptions of P711.20 billion increased by P89.62 billion or 14.42 percent. Table V-4
shows the details of comparative domestic debt repayments and redemptions.
230
Table V-4 Comparative Domestic Debt Repayments and Redemptions
Amount
(in million pesos)
Particulars Percent
Increase
2017 2016
(Decrease)
Bonds Payable 254,897.26 311,874.19 (56,976.93) (18.27)
Fixed rate T-Bonds 201,682.58 113,867.53 87,815.05 77.12
Benchmark bonds - 144,224.22 (144,224.22) -
Retail T-Bonds 51,003.81 51,337.50 (333.69) (0.65)
Agrarian reform bonds 2,210.67 2,443.45 (232.78) (9.53)
Domestic certificated/
uncertificated T-Bonds 0.19 1.48 (1.29) (86.93)
Treasury Bills 711,203.30 621,587.30 89,616.00 14.42
CB-BOL 429,568.30 429,568.30 - -
Regular 281,635.00 192,019.00 89,616.00 46.67
Loans Payable - 0.13 (0.13) -
Treasury notes - 0.13 (0.13) -
Total 966,100.56 933,461.62 32,638.94 3.50
Foreign Borrowings
The outstanding foreign borrowings at the end of FY 2017 of P2.213 trillion increased by
P55.10 billion from the previous year’s adjusted balance of P2.158 trillion. The
outstanding balance consists of loans contracted with foreign creditors amounting to
P848.74 billion and bonds issuances totalling P1.364 trillion. These loans represented
direct loans contracted by the NG and those relent to GCs. The balance of bonds payable
consists of global bonds of P1.322 trillion, and Japanese yen bonds of P42.33 billion.
Aggregate availments for the current year totalled P168.33 billion, which is P18.81 billion
or 12.58 percent higher than the amount of P149.52 billion in FY 2016. The increase was
due to issuance of global bonds and availments of concessional and program loans from
DPs, mostly from ADB, IBRD and JICA. Table V-5 shows the comparative foreign debt
availments.
Table V-5 Comparative Foreign Debt Availments
Amount
(in million pesos)
Particulars Percent
Increase
2017 2016
(Decrease)
Bonds Payable
Global Bonds 99,566.00 95,136.00 4,430.00 4.66
Loans Payable
Direct/Relent Loans 68,765.23 54,383.39 14,381.84 26.45
Total 168,331.23 149,519.39 18,811.84 12.58
The direct and relent loans contracted by the NG from external creditors of P68.77 billion
include cash availments of P60.76 billion and constructive availments of P8 billion in the
231
form of equipment and technical assistance. Presented in Table V-6 are the foreign debt
availments by type of loans and creditors.
Table V-6 Foreign Debt Availments by Type of Loans and Creditors
Percent
Amount
Particulars to
(in million pesos) Total
Global Bonds
Global Bonds 99,566.00 59.15
Direct/Relent Loans 68,765.23 40.85
Cash Availments 60,761.30 36.10
International Bank for Reconstruction and Development 29,772.70 17.69
Asian Development Bank 23,201.04 13.78
Japan International Cooperation Agency 7,058.93 4.19
International Fund for Agricultural Development 656.17 0.39
Organization of Petroleum Exporting Countries (OPEC)
Fund for International Development 72.46 0.04
Constructive Availments 8,003.92 4.75
Japan International Cooperation Agency 4,892.21 2.91
Export and Import Bank of Korea 1,116.12 0.66
Bank of Austria 951.59 0.57
Asian Development Bank 538.13 0.32
OPEC Fund for International Development 236.03 0.14
International Bank for Reconstruction and Development 228.77 0.14
International Fund for Agricultural Development 40.29 0.02
Kreditanstalt fur Wiederaufbau 0.78 -
Total 168,331.23 100.00
Payments made for matured and pre-terminated bonds decreased by P35.68 billion or
29.82 percent compared to previous year’s P119.65 billion. However, repayments for
loans increased to P56.92 billion from previous year’s P52.18 billion. Table V-7 shows
the comparative foreign debt repayments.
Table V-7 Comparative Foreign Debt Repayments
Amount
(in million pesos)
Particulars Percent
Increase
2017 2016
(Decrease)
Bonds Payable 83,970.65 119,645.96 (35,675.30) (29.82)
Global bonds 83,970.65 94,056.17 (10,085.52) (10.72)
Euro bonds - 25,589.79 (25,589.79) -
Loans Payable
Direct/Relent loans 56,923.79 52,183.21 4,740.58 9.08
Total 140,894.45 171,829.17 (30,934.72) (18.00)
Of the total payments for direct and relent loans, P18.16 billion or 31.90 percent was paid
to JICA, a bilateral creditor. Payments to ADB and IBRD, both multilateral creditors,
accounted for P21.21 billion or 37.26 percent and P7.46 billion or 13.11 percent,
respectively. Table V-8 shows the repayments for direct and relent loans.
232
Table V-8 Repayments for Direct and Relent Loans
Amount Percent
Creditor (in million pesos) to
Direct Relent Total Total
Asian Development Bank 21,042.44 169.26 21,211.69 37.26
Japan International Cooperation Agency 16,014.88 2,146.15 18,161.03 31.90
International Bank for Reconstruction
and Development 7,455.67 9.32 7,464.99 13.11
Japan Eximbank 1,932.86 - 1,932.86 3.40
International Development Association 794.49 36.17 830.66 1.46
US Public Law 800.38 - 800.38 1.41
Bank of Austria 569.85 - 569.85 1.00
United States Agency for International
Development (USAID) 266.04 - 266.04 0.47
Deutsche Bundesbank 230.15 - 230.15 0.40
French Protocol 217.90 - 217.90 0.38
Instituto Credito Oficial 186.03 - 186.03 0.33
Organization of the Petroleum Exporting Countries 182.03 - 182.03 0.32
Kreditanstalt fur Wiederaufbau 160.56 - 160.56 0.28
International Fund for Agricultural Development 141.45 10.95 152.40 0.27
USAID Housing Guaranty 87.10 - 87.10 0.15
Belgian Loan - 33.76 33.76 0.06
Other Creditors 4,390.20 46.18 4,436.38 7.79
Total 54,472.01 2,451.78 56,923.79 100.00
Actual Debt Service Expenditures
For FY 2017, the actual amount of debt service expenditures totalled P1.362 trillion
consisting of principal repayments of P1.047 trillion or 76.84 percent, interest payments
of P308.78 billion or 22.67 percent, and financial charges of P6.61 billion or 0.49 percent.
Compared to previous year’s amount of P1.411 trillion, FY 2017 actual debt service
decreased by P49.40 billion or 3.50 percent. Principal payments decreased by P58.71
billion or 5.31 percent compared to previous year’s payments of P1.105 trillion. Both
interest payments and financial charges increased by P8.15 billion or 2.71 percent and
P1.16 billion or 21.27 percent, respectively. Presented in table V-9 is the comparative
actual debt service of the NG.
Table V-9 Comparative Actual Debt Service of the National Government
Amount
(in million pesos)
Particulars Percent
Increase
2017 2016
(Decrease)
Principal Payments 1,046,581.30 1,105,290.79 (58,709.48) (5.31)
Foreign 80,480.74 171,829.17 (91,348.43) (53.16)
Global Bonds 26,008.73 119,645.96 (93,637.23) (78.26)
Direct/Relent 54,472.01 52,183.21 2,288.80 4.39
Domestic 966,100.56 933,461.62 32,638.94 3.50
Bonds 254,897.26 311,874.19 (56,976.93) (18.27)
T-Bills 711,203.30 621,587.30 89,616.00 14.42
Loans, Notes - 0.13 (0.13) -
233
Amount
(in million pesos)
Particulars Percent
Increase
2017 2016
(Decrease)
Interest Payments 308,775.84 300,627.76 8,148.08 2.71
Foreign 98,093.89 96,511.37 1,582.52 1.64
Global Bonds 82,936.00 84,244.29 (1,308.29) (1.55)
Direct/Relent 15,157.89 12,267.08 2,890.81 23.57
Domestic
Bonds 210,681.95 204,116.38 6,565.56 3.22
Financial Charges 6,605.84 5,447.12 1,158.72 21.27
Foreign 2,490.41 2,254.35 236.06 10.47
Commitment Fees 189.16 150.23 38.93 25.91
Documentary Stamp Tax 1,031.02 475.68 555.34 116.75
Other Financial Charges 271.87 665.34 (393.47) (59.14)
Loss on Guaranty 994.81 960.33 34.48 3.59
Bank Charges 3.55 2.77 0.78 28.25
Domestic 4,115.43 3,192.77 922.66 28.90
Documentary Stamp Tax 3,913.24 3,120.28 792.96 25.41
Other Financial Charges 202.19 72.48 129.70 178.94
Total 1,361,962.98 1,411,365.66 (49,402.68) (3.50)
The loss on guaranty pertains to foreign exchange risk cover on NG guaranteed obligations
of government financial institutions (GFIs) such as Development Bank of the Philippines,
Land Bank of the Philippines and Small Business Guarantee and Finance Corporation.
Commitment fees of P189.16 million incurred by various departments/offices increased

by P38.93 million from previous year of P150.23 million as shown in Table V-10.
Table V-10 Commitment Fees by Department/Office
Percent
Department/Office Amount
to Total
(in million pesos)
Social Welfare and Development 72.54 38.35
Finance 33.59 17.76
Transportation 29.58 15.64
Public Works and Highways 27.65 14.62
Energy 4.78 2.53
Environment and Natural Resources 3.91 2.07
National Irrigation Administration 2.26 1.19
Health 2.20 1.16
Interior and Local Government 1.60 0.85
Agrarian Reform 1.53 0.81
Other Departments/Offices 9.54 5.04
Total 189.16 100.00
Presented in Table V-11 are the releases of allotments from DBM and actual debt service
expenditures reported by the BTr.
234
Table V-11 Releases from DBM and Actual Debt Service Expenditures
Amount
(in million pesos)
Particulars Actual Debt
Allotment
Service Difference
Releases
Expenditures
Principal Repayments 312,403.00 1,106,995.01 (794,592.01)
Domestic 966,100.56
Foreign 140,894.45
Interests and Other Charges 334,877.00 310,437.42 24,439.58
Interest 334,877.00 308,775.84
Bank Charges 3.55
Other Financial Charges 474.06
Commitment Fees 189.16
Loss on Guaranty 994.81
Documentary Stamp Tax 4,944.25 4,944.25 -
Total 652,224.25 1,422,376.68 (770,152.43)
The difference of P794.59 billion pertained to repayments for relent loans, which were not
included by the BTr in its request for allotment releases from the DBM, as these were
considered receivable and collectible of the NG from GCs. Further,
repayments/redemptions of government securities were partially funded through the
Sinking Fund. The difference of P24.44 billion pertained to the unobligated balance of
allotments.
Status of NG Debt as at December 31, 2017
Over the ten-year period, the country’s NG debt has continuously increased. This year
noted the highest growth of P562.03 billion or 9.22 percent, followed by P490.06 billion
or 9.91 percent in FY 2012. Table V-12 shows the outstanding balance of NG debt for FYs
2008 to 2017.
Table V-12 Outstanding Balances of NG Debt

FY 2008 – FY 2017
Amount
(in billion pesos)
Year Percent
Increase
Domestic Foreign Total
(Decrease)
2017 4,442.78 2,212.80 6,655.58 562.03 9.22
2016 3,935.85 2,157.71 6,093.56 147.89 2.49
2015 3,877.61 2,068.06 5,945.67 214.97 3.75
2014 3,815.81 1,914.88 5,730.70 60.09 1.06
2013 3,728.33 1,942.28 5,670.61 237.66 4.37
2012 3,460.82 1,972.13 5,432.95 490.06 9.91
2011 2,860.60 2,082.29 4,942.89 241.75 5.14
2010 2,704.42 1,996.72 4,701.14 353.06 8.12
2009 2,480.83 1,867.25 4,348.08 210.08 5.08
2008 2,440.90 1,697.10 4,138.00 356.52 9.43
2007 2,218.82 1,562.66 3,781.48
235
During FY 2017 the beginning balance of outstanding loans of P6.094 trillion increased
by P562.03 billion, resulting in the year-end balance of P6.656 trillion. The increase was
composed of P534.01 billion, which was the difference between total loan availments of
P1.641 trillion and total loan repayments of P1.107 trillion, plus revaluation and other
adjustments of P28.02 billion.
Chart V-1 shows the NG Debt increase by source, from FYs 2008 to 2017.
Chart V-1 NG Debt Growth

(in million pesos)
Contingent Liabilities
Contingent liabilities arise from sovereign guaranty extended by the NG to the GCs for
obtaining foreign loans. FY 2017 contingent liabilities of P478.11 billion was composed
of GCs’ foreign and domestic loans guaranteed by the NG of P280.60 billion or 58.69
percent and P197.51 billion or 41.31 percent, respectively. The GCs with loans guaranteed
by the NG are shown in Table V-13.
Table V-13 Loans of Government Corporations Guaranteed

by the National Government
Amount Percent
Particulars
(in million pesos) to Total
Power Sector Assets and Liabilities Management Corporation 213,177.83 44.59
National Food Authority 119,555.85 25.01
Development Bank of the Philippines 56,143.77 11.74
Land Bank of the Philippines 24,318.48 5.09
Bases Conversion and Development Authority 20,359.12 4.26
National Home Mortgage Finance Corporation 11,389.51 2.38
Metropolitan Waterworks and Sewerage System 6,640.44 1.39
Subic Bay Metropolitan Authority 5,423.37 1.13
Philippine National Bank 4,235.09 0.89
Light Rail Transit Authority 3,881.76 0.81
Philippine Ports Authority 3,587.45 0.75
236
Amount Percent
Particulars
(in million pesos) to Total
Local Water Utilities Administration 2,772.80 0.58
Manila International Airport Authority 2,226.62 0.47
Philippine National Railways 1,576.89 0.33
Small Business Guarantee and Finance Corporation 1,136.83 0.24
National Power Corporation 696.46 0.15
Trade and Investment Development Corporation of the Philippines 490.68 0.10
Tourism Infrastructure and Enterprises Zone Authority 234.53 0.05
Philippine Economic Zone Authority 110.27 0.02
National Development Company 99.24 0.02
Partido Development Administration 56.36 0.01
TOTAL 478,113.36 100.00
Excluded in the list are the contingent liabilities of NG under the Philippine Public-Private
Partnership Program such as: build-operate and own, build-operate and transfer, build and
transfer, and build-transfer and operate wherein the valuation of the extent of NG liability
or exposure cannot yet be established in the absence of data regarding these projects. Also
excluded in the NG contingent liabilities are the guarantees extended by the GFIs
considering that there is no explicit NG guarantee and these are already part of the GFIs
contingent liabilities.
237
VI. SUMMARY OF
AUDIT OPINIONS
Annex B
COMMISSION ON AUDIT
NATIONAL GOVERNMENT SECTOR
For Calendar Year 2017
PART VI - SUMMARY OF AUDIT OPINIONS
AUDIT OPINIONS REASONS FOR MODIFIED

AGENCIES UQ Q A D OPINION
Cluster 1 – EXECUTIVE OFFICES
1. Bureau of Broadcast 
 
Services (BBS)
2. Bureau of  
Communication
Services (BCS)
3. Climate Change    
Commission (CCC)
4. Commission on   
Filipino Language
(CFL)
5. Commission on    There was a net overstatement of the
Filipino Overseas account balance by PhP0.051 million due
(CFO) to erroneous dropping of Property, Plant
and Equipment (PPE) and non-
reclassification of semi-expendable items
to the proper account;
 Unissued semi-expendable items of
PhP0.10 million were erroneously dropped
from the books which understated the
inventory account balance and overstated
the expense account;
 Unrecognized liability for the prorated
share of the Year-End Bonus and Cash
Gift due to entitled personnel amounting to
PhP0.116 million in the books resulted in
the understatement of the related payable
and expense accounts by the same amount;
 Expenses incurred in the amount of
PhP1.080 million that should have been
charged against the trust receipts were not
adjusted to Due to NGAs account thus,
overstating the said account and
understating the Accumulated
Surplus/(Deficit) account by the same
amount; and
 Understatement of the Development in
Progress-Websites/Other Intangible Assets
account by PhP0.774 million to erroneous
recording of the salaries of programmers
hired for the development of the CFO’s
system/website.
6. Cooperative    Non-recognition of Allowance for
Development Impairment as PhP38.508 million or 93.22
Authority (CDA) percent of the Cash in Bank (CIB) – Local
Currency, Time Deposits (LCTD), and
PhP54.055 million or 43.87 percent of the
Investment in Stocks account, may not be
recovered from the issuer-cooperative and
investee-cooperative banks.
7. Dangerous Drugs    Receipt of Notice of Cash Allocation
238
Board (DDB) (NCA) as Special Fund for drug
rehabilitation activities and the remittance
of related collections in excess of the
amount allowed to be utilized for the
purpose were not properly taken up in the
books thereby resulting in the
overstatement of the accounts Cash-
Treasury/Agency Deposit, Special and
Accumulated Surplus by PhP460.36
million; and
 Transfer of funds to a Government-Owned
and Controlled Corporation (GOCC) in the
amount of PhP1.21 million for a research
study on medical marijuana was recorded
as an expense instead of inter-agency
receivable.
8. Department of    Unreliable CIB-Foreign Currency Accounts
Foreign Affairs amounting to PhP6,520.46 million due to
(DFA) negative balances, unidentified bank
accounts, unadjusted reconciling items,
inclusion of bank accounts of closed posts
and closed bank accounts, and unrecorded
bank accounts, in an aggregate amount of
PhP473.59 million, while dormant bank
accounts amounted to PhP162.85 million;
 Unreliable Cash-Collecting Officers
account balance in the net amount of
PhP30.51 million due to existence of
abnormal and unaccounted balances
amounting to PhP11.30 million and
PhP16.95 million, respectively;
 Unreliable Land, Buildings and Other
Structures ending balances in the amounts
of PhP505.64 million, PhP3,398.30 million
and PhP920.06 million, respectively, due to
existence of “unclassified”, “for
reconciliation” and PPE described only as
“Others” in the Subsidiary Ledgers (SL) in
the total amount of PhP607.77 million.
Moreover, cost of land and building in the
total amount of PhP397.16 million were not
recorded separately contrary to Paragraph
74 of PPSAS 17;
 Unreliable Due from National Government
Agencies (NGAs) and Due from
Government-Owned or Controlled
Corporations (GOCCs) accounts balances
amounting to PhP3,711.62 million due to:
(a) discrepancy of PhP240.65 million
between the records of DFA and other
agencies; (b) existence of accounts with
long outstanding balances amounting to
PhP616.69 million; (c) overstatement of the
account Due from NGAs by PhP82.58
million and understatement of the account
Due from GOCCs by PhP3.19 million for
errors and omission in recording receipts
and settlements of accounts; and
(d) inclusion of unclassified SL accounts
amounting to PhP163.64 million;
 Due to GOCCs account balance was not
fairly presented due to existence of
unidentified/unverified accounts captioned
only as “Others” amounting to PhP2,643.37
239
million representing 95.62 percent of the
total balance of PhP2,764.45 million;
 Unreliable Other Payables account balance
of PhP729.61 million due to existence of:
(a) unpaid membership contributions to
international organizations and employees
personal contributions to health insurance
of more than three years, (b) abnormal SL
balance, (c) unidentified accounts with no
supporting details, (d) outstanding balances
of closed posts, and (e) erroneous
classification of accounts in the total
amount of PhP417.13 million;
 Advances to Special Disbursing Officers
and Advances to Officers and Employees
accounts balances aggregating to
PhP107.36 million were uncertain due to:
(a) 35 percent of the accounts’ balance
were outstanding for more than 10 years;
(b) existence of subsidiary ledger accounts
with negative balances amounting to
PhP34.85 million which reduced the
balance by 32.46 percent; and
(c) overstatement of account Advances to
Officers and Employees by PhP37.857
million;
 Accuracy of Accounts Payable reported
balance of PhP1,356.82 million was not
assured due to existence of: (a) transactions
with unidentified creditors amounting to
PhP173.18 million; (b) net difference of
PhP3.66 million between SL and the
confirmed balances with the creditor; and
(c) negative SL balances of PhP10.28
million; and
 Reporting difference of PhP30.51 million
between the balance per bank confirmation
and SLs cast doubt on the accuracy of the
reported balance of the accounts CIB-Local
Currency, Current Account (LCCA) and
Savings Account (LCSA) of the Passport
Revolving Fund as at 31 December 2017.
9. Fertilizer and  
Pesticides Authority
(FPA)
10. Film Development    The fairness of presentation of the
Council of the receivable accounts amounting to
Philippines PhP166.35 million, net of allowance for
(FDCP) impairment of PhP7.01 million as at
31 December 2017 could not be
ascertained due to misclassified accounts
receivables of PhP56.59 million and
unrecognized interest income of at least
PhP1.59 million.
11. Foreign Service    Receivables arising from irregular payment
Institute (FSI) amounting to PhP0.28 million were not
recognized in the books, thereby,
understating the account Due from
Officers and Employees by the same
amount; and
 Accounts Payable with a balance of
PhP2.16 million as at 31 December 2017
was overstated by PhP1.66 million due to
recognition of liability for goods not yet
240
delivered in the amount of PhP0.26 million
and erroneous recording of personnel
benefits amounting to PhP1.40 million
instead of Due to Officers and Employees.
12. Games and  
Amusements Board
(GAB)
13. Governance  
Commission for
GOCCs (GCG)
14. Housing and Land  
Use Regulatory
Board (HLURB)
15. Housing and Urban  
Development
Coordinating
Council (HUDCC)
16. Movie and  
Television Review
and Classification
Board (MTRCB)
17. National Anti-    PPE accounts balances amounting to
Poverty Commission PhP28.88 million as of 31 December 2017
(NAPC) were overstated by PhP2.73 million due to
the inclusion of undelivered and missing
items costing PhP2.42 million and PhP0.31
million, respectively; and
 Purchases of supplies and materials for
stock amounting to PhP1.73 million were
erroneously recorded as Office Supplies
Expense account instead of Office
Supplies Inventory.
18. National Archives of    Payments for the digitization of the
the Philippines agency’s Spanish documents amounting to
(NAP) PhP5.5 million were erroneously recorded
as Other Professional Service instead of
Other Intangible Assets, which resulted in
the misstatement of the total reported
balance of assets and expenses in the
financial statements; and
 The PPE accounts, with carrying amount
of PhP100.03 million, were overstated due
to inclusion of items below the
capitalization threshold of PhP15,000.00 in
the total amount of PhP11.57 million.
19. National  
Commission on
Culture and the
Arts (NCCA)
20. National  
Commission on
Indigenous Peoples
(NCIP)
21. National    Salaries and Wages account was overstated
Commission on by PhP22.21 million due to
Muslim Filipinos misclassification of accounts Overtime and
(NCMF) Night Pay and Other Personnel Benefits
PhP7.86 million, respectively;
 Tangible items below the capitalization
threshold of PhP15,000.00 were
recognized as PPE instead of semi-
expendable assets amounting to PhP3.6
241
million; and
 Unrecognized foreign exchange loss
amounting to PhP0.11 million.
22. National Historical    The Other Professional Services account
Commission of the balance was overstated by PhP17.9
Philippines (NHCP) million due to erroneous recording of the
cost of items for distribution, e-books,
curatorial works, development cost of
computer terminal, and production cost of
audio visual presentations/documentary
to said account thus, consequently
understated the other affected asset
accounts.
 Land acquired in 2007 was erroneously
classified as Land Improvements.
 Collection and deposit of penalty of
PhP0.30 million for violating Heritage
Law erroneously recorded hence, not
recognized in the books as Income and
Cash-Treasury/Agency Deposit, Regular
Accounts.
 Unrecorded properties located in Taal,
Batangas and Kawit, Cavite registered in
the name of the Agency and used as
museums.
23. National Library of the    Non-reclassification of completed project
Philippines costing PhP269.7 million from
Construction in Progress (CIP) to
Buildings account affected the balance of
the specific PPE accounts; and
 Unrecorded donated properties from the
Office of the Vice President (OVP)
consisting of PPE and semi-expendable
items amounting to PhP0.42 million and
PPE as donations.
24. National Printing    CIB-LCCA account balance amounting to
Office (NPO) PhP608.63 million was understated by
PhP19.18 million due to: (a) unadjusted/
uncorrected reconciling items with net
amount of PhP17.15 million; and
(b) unrecorded cancelled checks and stale
checks aggregating to PhP2.04 million;
 PPE accounts reported balance
amounting to PhP725.96 million was
inaccurate due to: (a) an understatement
by PhP3.65 million caused by various
recording errors previously identified in
CY 2016; (b) non-computation of
depreciation expenses amounting to
PhP1.13 million of PPE items purchased
in CY 2016; and (c) inclusion of semi-
expendable items costing PhP0.29
million;
 357 numbering boxes with total cost of
PhP10.41 million were improperly
recorded as PPE item by both the Supply
and Property Section and the Accounting
Section, which resulted in the
overstatement of Machinery account,
depreciation expense, and accumulated
depreciation by PhP10.41 million,
PhP1.05 million, and PhP9.01 million,
respectively; and the Press Division
242
already reported 90 damaged/dilapidated/
wrecked numbering box but their disposal
was not yet initiated;
 Income from the use of NPO facilities
such as atrium, multi-purpose hall and
employees’ quarters amounting to
PhP0.32 million and income from the
renewal of Official Gazette (OG)
subscription amounting to PhP0.023
million were recorded/misclassified under
the account Other Business Income rather
than Rent/Lease; and
 NPO-Multi Purpose Cooperative’s (NPO-
MPC) electric and water bill charges
amounting to PhP0.11 million were also
inaccurately recorded as income of the
agency.
25. National Youth    PPE as at 31 December 2017 could not be
Commission (NYC) established due to unrecorded
depreciation charges of PhP0.39 million.
The total PPE of PhP4.981 million is
35.74 percent of the total assets of
PhP13.94 million; and
 Trust Liabilities account was overstated
by PhP4.34 million due to non-reversion
of prior year expenses.
26. News and  
Information Bureau
(NIB)
27. National Intelligence  
Coordinating Agency
(NICA)
28. National Security    Semi-expendable properties were not
Council (NSC) reclassified to the appropriate semi
expendable accounts resulting in the
overstatement of the affected PPE
accounts by PhP9.47 million,
Accumulated Depreciation by PhP5.61
million; Accumulated Surplus by
PhP3.86 million;
 Unrecorded donations received resulting
in the understatement of PPE-Information
and Communication Technology by
PhP0.207 million and related
million and overstatement of
Accumulated Surplus by PhP0.13
million;
 Liquidations of inter-agency fund transfer
representing expenses chargeable to
liability were not adjusted at year-end
resulting in the overstatement of the Due
to NGSs by PhP10.01 million and the
related expense accounts by the same
amount; and
 Adjustments of representation expenses
were erroneously taken up resulting in the
overstatement of Representation
Expenses and understatement of Other
Professional Services, both by PhP0.16
million.
29. Optical Media Board    Overstatement of Advances to
(OMB) Contractors account in the amount of
243
PhP1.15 million due to erroneous
recording of checks drawn/prepared in
favor of various suppliers of still
undelivered items; and
 Overstatement of PPE accounts by
PhP0.11 million due to inclusion of
missing communication equipment which
remained unsettled by the AOs as of
31 December 2017.
30. Office of the  
President (OP)
31. Office of the    Overstatement of Accounts Payable (AP),
Presidential Adviser Financial Assistance to Local
on the Peace Process Government Units (LGUs), Subsidies-
(OPAPP) Others and Road Networks accounts by
PhP143.89 million, PhP136.09 million,
PhP7.2 million and P0.6 million,
respectively due to erroneous recognition
of obligations amounting to PhP143.89
million incurred in CY 2017 as AP;
 Overstatement of Computer Software
account and understatement of
Information and Communication
Technology Equipment account by
PhP0.22 million for both accounts due to
acquisition of computers during the year
as Computer Software instead of
Information and Communication
Technology Equipment; and
 Overstatement and understatement of the
CIB-LCCA and Cash-Collecting Officers
accounts, respectively, by PhP0.22
million due to undeposited collections for
the Mainstreaming Peace and
Development in Local Governance in the
Philippines fund.
32. Office of the Vice  
President (OVP)
33. Philippine    Overstatement of Due from Regional
Information Agency Offices (ROs) account and
(PIA) understatement of Advances for
Operating Expenses account by PhP54.23
million due to incorrect use of Due from
ROs account instead of Advances for
Operating Expenses to record fund
transfers to PIA Regional Offices;
 Unreliable PPE account balances as at
31 December 2017 due to various
defects and errors such as (a) inclusion of
semi-expendable items costing PhP5.37
million; (b) understated depreciation by
PhP2.8 million; (c) erroneous
classification of various equipment
costing P0.51 million; and (d) non-
recording of Motor Vehicle worth
PhP6.25 million, which affected the fair
presentation of the Financial Statements
(FSs).
34. Philippine  
Commission on
Women (PCW)
35. Philippine  
Competition
244
Commission (PCC)
36. Philippine Drug    Receipt of funds in the amount of
Enforcement PhP17.82 million for the construction of a
Agency (PDEA) building in Regional Office No. 10 was
recorded as Construction in Progress
(CIP) and AP despite absence of any
progress made or expenses incurred in the
construction; and
 The main building presently occupied by
PDEA National Headquarters by virtue of
Executive Order No. 227 is not
recognized in the books.
37. Philippine Racing    Overstatement of account Prizes due to
Commission expenses for meals, media promotions,
(PhilRaCom) gasoline, parking/toll fees among others,
amounting to PhP8.89 million
erroneously charged to the said account;
 Overstatement of PPE and Accounts
Payable (AP) amounting to PhP2.94
million and PhP2.94 million,
respectively, due to recognition of
undelivered and missing PPE; and
 Overstatement of account Other
Maintenance and Other Operating
Expenses (MOOE) due to erroneous
usage of the said account in the payment
of the procurement of services of foreign
consultants in the amount of PhP0.53
million net of 10 percent tax and PhP0.07
million representing airfare, hotel
accommodation and transport rental for a
total of PhP0.61 million.
38. Philippine Sports   Unreliable CIB accounts balances of
Commission (PSC) PhP2,088.85 million due to: a) unadjusted
book reconciling items in the net amount
of PhP9.32 million; and b) non-
restoration of the unreleased commercial
checks amounting to PhP8.23 million to
the CIB accounts, resulting in net
overstatement of PhP1.09 million;
 Existence and reliability of the PPE
accounts with carrying amount of
PhP453.08 million as at 31 December
2017 could not be established due to:
a) unrecorded/erroneously classified PPE
amounting to PhP1.70 million; b) non-
reclassification of completed structures
costing PhP1.61 million from CIP
account to proper PPE account; and c)
non-recognition of depreciation expense
of PhP6.89 million for completed
structures, and undetermined amount for
other unrecorded PPE;
 Unreliable Due from Non-Government
Organizations/People’s Organizations
(NGOs/POs) account balance of
2017 due to negative subsidiary ledger
(SL) balances of PhP6.37 million;
 Unreliable Other Receivables account
balance of PhP81.85 million as at 31
December 2017 due to: a) negative SL
balances of PhP115.15 million;
245
b) unsupported balances of PhP3.94
million; and c) erroneous recording of
transactions amounting to PhP0.62
million to said account;
 Doubtful reliability Inventory accounts
balance amounting to PhP54.27 million
because of material difference of
PhP43.18 million between the General
Ledger (GL) balance and the Report on
the Physical Count of Inventories (RPCI)
due to unrecorded issuances of semi-
expendable supplies of PhP62,848.88 and
sports supplies/items with undetermined
amount; and
 AP was overstated by PhP6.75 million
due to erroneous recording in the books
of undelivered goods and services as
payable.
39. Presidential    Various expenses of prior year’s
Broadcast Staff – amounting to PhP0.68 million were
RTVM included in CY 2017 resulted in the
(PBS-RTVM) overstatement of the current year’s
various expenses;
 Accrued liabilities for gasoline and
services rendered were not recognized
during CY 2017 resulted in the
understatement of AP and Due to BIR by
PhP0.19 million and PhP7,256.52,
respectively, and the affected expenses of
the agency; and
 Discrepancy between the books of PBS-
RTVM and PS-DBM amounting to
PhP2.4 million as of 31 December 2017
was due to unrecorded transactions not
recognized by PBS-RTVM.
40. Presidential    Error in journalizing transactions
Commission on amounting to PhP2 million for the System
Urban Poor Development of an Integrated PCUP
(PCUP) Mission-critical Information Systems
(MIS) Project Phase I and Supply and
Delivery of Support Hardware, Software
and Services by debiting Information and
Communication Technology (ICT)
Equipment account and crediting AP
account amounting to PhP2 million and
P1 million, respectively, contrary to
Government Accounting Manual (GAM),
Volume III; and
 Unreliable PPE account balances
amounting to PhP151.502 million due to
misclassification of accounts,
unaccounted/missing PPE and
overstatement of Office Equipment (OE)
and ICT Equipment accounts resulting to
the discrepancy between the book balance
and the Report of Physical Count of
Property Plant and Equipment (RPCPPE)
by PhP1.78 million.
41. Presidential    Unliquidated cash advances (CAs) of
Communications PhP28.2 million and PhP0.69 million that
Operations were beyond the prescribed dates of
Office (PCOO) liquidation, granted to Special Disbursing
Officers (SDOs) and to Officers and
246
Employees, respectively at 31 December
2017.
42. Presidential  
Legislative Liaison
Office (PLLO)
43. Presidential  
Management Staff
(PMS)
44. UNESCO National    Overstatement of PPE accounts of
Commission of the PhP3.90 million by PhP0.40 million due
Philippines to non-reclassification of semi-
(UNACOM) expendable properties amounting to
PhP0.15 million and erroneous
recognition of computer software
amounting to PhP0.25 million to Office
Equipment account;
 Due to Officers Due to Officers and
Employees and Other Payables accounts
in the amounts of PhP0.08 million and
PhP0.99 million, respectively, could not
be relied upon due to absence of
supporting documents, no actual claims
had been filed for more than 10 years,
had been non-moving for more than two
years and were not reverted;
 Existence of abnormal balances of the
accounts Due to GSIS and Due to
PhilHealth amounting to PhP0.04 million
understating the balance of the accounts
by the same amount; and
 Prior year expenses amounting to
PhP0.99 million were paid out of the
current year appropriation resulting in the
overstatement of the current year’s
expenses and consequently understating
the Government Equity.
TOTAL 20 23 1
Notes: Management Letter (ML) was issued to Technical Cooperation Council of the Philippines (TCCP)
Cluster 2 – Oversight and Public Debt Management
1. Anti-Money   Computer Software account was
Laundering Council erroneously provided with 10 per cent
(AMLC) residual value amounting to PhP2.41
million, which affected the total assets
with 4.65 percentage of error
2. Bureau of Local   Various accounting errors in recording
Government Finance and reporting of financial transactions
(BLGF) resulting in total errors of PhP29.27
million affected the total assets, liabilities
and net assets/equity by PhP14.96
million, PhP3.62 million and PhP10.69
million, respectively, and
 Accuracy and completeness of several
asset accounts amounting to PhP71.05
million could not be ascertained due to
various accounting deficiencies noted,
and the Calendar Year (CY) 2016 figures
presented in the CY 2017 FS were not
restated to reflect prior year errors and
adjustments.
3. Bureau of Customs   Due to the non and/or delayed receipt by
(BOC) the OCOM Accounting Division of the
Statement of Monthly Allocation and
Utilization (SMAU) reports by the
247
concerned ports, a total adjustments of
PhP16.87 billion, representing income,
expenses, and other prior years’
adjustments were recorded only in 2017,
in its effort to restate the centralized FS.
Said related transactions were lumped
under Accumulated Surplus; and
 Various errors and deficiencies in
keeping of the accounts of the Bureau had
resulted in the misstatement of accounts.
Had these income, expenses, and prior
years, adjustments been restated at the
appropriate accounts, many elements in
the accompanying centralized financial
statements would have been materially
affected.
4. Bureau of Internal   Accounting errors/omissions misstated
Revenue (BIR) the Asset, Liability, and Accumulated
Surplus/(Deficit) accounts by PhP761.9
million, PhP76.7 million, and PhP775.21
million, respectively; and
 Various accounting deficiencies in
recording and reporting financial
transactions undermine the qualitative
characteristics of the information in the
FSs.
5. Bureau of Treasury   Overstatement of Prepaid Insurance and
(BTr) - Proper Accumulated Surplus/(Deficit) by PhP1
billion due to the payment of insurance
coverage for government facilities against
natural calamities, a National
Government (NG) transaction, under
BTr-CO and its recording in the BTr-RA
books;
 Overstatement of Bank Charges and
understatement of Other Receivables by
PhP15.01 million due to unadjusted
transaction fees under Bank Charges
representing excess payments of the fees
to authorized agent banks and authorized
government depository banks;
 Understatement of Bank Charges and
overstatement of Accumulated
Surplus/(Deficit) by PhP6.99 million due
to the erroneous recording of prior year’s
adjustments related to transaction fees;
 Understatement of Accumulated
Depreciation and Depreciation Expenses
of the PPE accounts by PhP0.67 million
due to non-recognition of depreciation
expenses for PPEs when the PPE were
available for use; and
 Overstatement of Fines and Penalties-
Business Income, Fines and Penalties-
Service Income and Accumulated
Surplus/(Deficit) by PhP0.34 million,
PhP4,000.00 and PhP0.34 million,
respectively due to non-remittance/
crediting to the Treasurer of the
Philippines bank account of NG’s income
from interests and penalties.
6. Central Board 
Assessment Appeals
248
(CBAA)
7. Department of Budget   Several account balances were either
and Management overstated or understated due to various
(DBM) accounting errors; and
 Balances of several asset accounts
amounting to PhP2.02 billion were either
unreconciled with RPCPPE, RPCI or
various National Government Agencies'
(NGAs) book balances.
8. Department of   Understatement of Intangible Assets and
Finance (DOF) Semi-Expendable Inventories, and
Accumulated Surplus/(Deficit) by
PhP25.65 million due to unrecorded
properties received from Millennium
Challenge Account-Philippines;
 Understatement of various PPE accounts
and Accumulated Surplus/(Deficit) by
deliveries;
 Understatement of Due to GOCCs and
Surplus/(Deficit) by PhP7,098.79 due to
unrecorded loan amortizations deducted
from employees’ salaries;
 Understatement of Due to BIR and
to over remittances of taxes;
 Understatement of Due to GSIS and
to errors in posting and over remittances;
 Misclassification in recording various
asset and liabilities accounts amounting
to PhP1.51 million; and
 Retained in CIB-LCCA accounts the
amount of PhP56.09 million without
authority; unremitted to the BTr.
9. Government 
Procurement Policy
Board –Technical
Support Office
(GPPB-TSO)
10. Insurance 
Commission (IC)
11. Legislative-Executive   Overstatement of PhP28,221.96 under
Development Due from NGAs and Accumulated
Advisory Council Surplus/(Deficit) accounts, which
(LEDAC) affected the total assets and equity both
12. Municipal   Overstatement of Investment in Treasury
Development Fund Bills-Local by PhP12.25 billion, and
Office (MDFO) understatement of CIB-LCTD,
Investment in Treasury Bonds-Local, and
Financial Assets Designated at Fair Value
Through Surplus or Deficit accounts of
PhP2.48 billion, PhP7.84 billion and
PhP1.94 billion, respectively, due to
misclassification in recording various
investments;
 Understatement of Investment in
Treasury Bonds-Local of PhP422.82
million due to non-amortization of 24
249
Held-to-Maturity Investments;
 Overstatement of Interest Receivable and
Interest Income of PhP328.87 million and
PhP119.58 million and understatement of
Taxes, Duties and Licenses of P0.63
million due to non-amortization of Held-
to-Maturity Investments and
inappropriate reduction of withholding
tax; and
 Understatement of Taxes, Duties and
Licenses and Other Payables accounts of
PhP74.45 million and PhP23.45 million
due to non-recognition of tax expense on
interest received and accrued interest
from 24 Held-to-Maturity Investments,
time deposits and placement in bonds and
tax payable on accrued interest,
respectively.
13. National Economic   Misstatements of PhP82.16 million on
and Development Assets and PhP57.63 million on the
Authority (NEDA) Liabilities and Equity accounts due to
accounting errors, and accounting
deficiencies of PhP46.33 million.
14. National Tax 
Research Center
(NTRC)
15. Philippine National 
Volunteer Service
Coordinating Agency
(PNVSCA)
16. Philippine Statistics   Management’s inability to submit the
Authority (PSA) underlying reports, schedules
disbursement vouchers, and documents
which supports the entries covering the
period September to December 2017 thus,
validity of the related transactions for the
same period was not ascertained by the
Audit Team.
17. Philippine Statistical   Various accounting errors/omissions in
Research and recording and reporting of financial
Training Institute transactions resulting in total error of
(PSRTI) PhP6.80 million affecting the total asset
accounts and of PhP3.75 million affecting
the Net Assets/Equity Accounts; and
 Accounting deficiencies in recording and
reporting financial transactions
18. Privatization   Various accounting errors in recording
Management Office and reporting of financial transactions
(PMO) resulting in total errors of PhP69.53
million affected the total assets,
liabilities, and net assets/equity by
PhP6.44 million, PhP3.77 million, and
PhP59.32 million, respectively; and
 Balances of several asset and liability
accounts amounting to PhP158.83 million
and PhP16.14 billion, respectively, were
not supported with documents, inexistent
or unreconciled, and have been dormant
for more than 10 years.
19. Procurement Service   Various errors in respect of the
(PS) recognition and measurement criteria
under the GAM and application of
250
accounting principles resulted to total
error of PhP535.83 million affecting
Total Assets, PhP609.48 million for Total
Liabilities, and PhP8.50 billion for Total
Equity.
20. Public-Private 
Partnership Center of
the Philippines
(PPPCP)
21. Securities and   Various errors/omissions in the recording
Exchange and reporting of financial transactions
Commission (SEC) resulting to a total error of PhP24.88
million affecting the Total Asset
Accounts and of PhP25.58 million
affecting the Total Net Assets/Equity
Accounts.
 Accounting deficiencies in the recording
and reporting of financial transactions
22. Tariff Commission   Undelivered inventories and PPE
(TC) amounting to PhP0.75 million were
recognized in the books resulting in
overstatement of the Inventories and PPE
accounts by PhP0.7 million and PhP0.05
million, respectively, as of 31 December
2017; and
 Collections of performance securities
amounting to PhP0.09 million were not
issued official receipts thus, not
recognized in the books resulting in
understatement of the Cash-Collecting
Officer and Guaranty/Security Deposits
Payable accounts.
23. Bureau of the   Accounting errors/omissions misstated
Treasury-National the Assets, Liabilities and Accumulated
Government (BTr- Surplus (Deficit) accounts by PhP15.47
NG) billion, PhP21.60 billion and P30.60
billion, respectively; and
 Various accounting deficiencies in
recording and reporting financial
transactions undermine the qualitative
characteristics of the information in the
FSs.
Total 6 15 1 1
Cluster 3 – Legislative, Judiciary and Constitutional Offices

1. Commission on 
Appointments (CA)
2. Commission on   Unreliable Due from NGAs -
Human Rights (CHR) Procurement Service (PS) account year-
end balance of PhP5.33 million as at
31 December 2017 due to:
a) unreconciled difference of PhP5.06
million between the CHR Accounting
record and the PS records;
b) unreconciled balance between the
CHR Accounting and Property records;
and c) unrecorded deliveries of office
supplies/equipment in CY 2016
amounting to PhP2.18 million in the CHR
books of accounts; and
 Accuracy and reliability of the PPE
account amounting to PhP135.72 million
251
could not be ascertained due to
unreconciled differences aggregating to
PhP164.06 million between the
accounting and property records.
3. House of 
Representatives
4. House of 
Representatives-
Electoral Tribunal
(HRET)
5. Presidential Electoral   Unreliable CIB-LCCA and CIB-LCSA
Tribunal (PET) accounts year-end balances amounting to
PhP74.78 million and PhP0.97 million,
respectively, due to: (a) delayed/non-
submission of the monthly Bank
Reconciliation Statements (BRSs), and
(b) unadjusted reconciling items in the
BRSs of PhP2,390.00 and negative
amount of PhP7.72 million, respectively;
and
 Unreliable PPE accounts amounting to
PhP4.01 million as of year-end due to:
(a) unreconciled difference of PhP1.52
million between the balances per books
and per RPCPPE; and b) inclusion of
semi-expendable properties worth
PhP41,225.00.
6. Office of the   Unreliable Inventory accounts balances
Ombudsman amounting to PhP21.09 million as of 31
December 2017 due to unreconciled
balances of PhP3.7 million between the
Accounting Division (AD) and Property
Management Section (PMS) records and
non-maintenance/non-reconciliation of
Supplies Ledger Cards (SLCs) and Stock
Cards (SCs) in the OMB Central Office,
and the inclusion of issued semi-
expendable items in the Inventory
accounts amounting to PhP5.59 million in
OMB-Visayas; only the RPCI for Office
Supplies Inventory, among the five
inventory accounts, was submitted by the
OMB-CO to the Commission on Audit
(COA); and
 Existence, accuracy and reliability of the
PPE accounts amounting to PhP1,510.79
million could not be ascertained showing
a difference of PhP197.56 million due to
non-reconciliation between Accounting
and Property records in the OMB-CO and
OMB-Luzon and non-submission of the
RPCPPE of the OMB-MOLEO and
OMB-Mindanao within the prescribed
period; the RPCPPE submitted lacks
relevant information relative to the PPE
and neither certified correct by the
Inventory Committee Chairperson and
Members, nor approved by the Agency
Head and not verified by the COA
representative.
7. Senate of the 
Philippines
8. Senate Electoral 
Tribunal (SET)
252
9. Supreme Court of   Calendar Year (CY) 2016 errors and
the Philippines adjustments were neither restated nor
disclosed in the CY 2017 FSs to reflect
prior year errors and adjustments;
 Unreliable Cash - Collecting Officers
account balance amounting to PhP284.33
million as at 31 December 2017 due to:
(a) absence of details as to Special
Collecting Officers (SCOs) accountable
for the undeposited collections of
PhP281.46 million; (b) delayed recording
of collections and deposits of PhP908.30
respectively; (c) unreported collections
and deposits of undetermined amount
caused by delayed/non-submission of
Report of Collections and Deposits
(RCDs) by some SCOs nationwide; and
(d) unsupported book adjustments
PhP10.51 million;
 Unreliable CIB-LCCA balance
amounting to PhP1,234.13 million due
to: (a) discrepancies amounting to
PhP404.74 million between the balances
of the bank accounts per books and per
bank; (b) inclusion of four closed bank
accounts with a net debit balance of
PhP248.10 million; (c) closing and/or
adjustments of nine dormant accounts in
the net amount of PhP17.42 million
without supporting documents;
(d) existence of inactive and non-interest
bearing bank accounts for Continuous
Form Check (CFC) amounting to
PhP267.92 million; (e) erroneous
deduction in the bank balance in the BRS
of PhP6.06 million; (f) unrecorded book
reconciling items in the net amount of
PhP79.89 million as well as stale checks
of PhP0.90 million; and (g) inclusion of
three dormant and unconfirmed bank
accounts with a net debit balance of
PhP0.01 million;
 Unreliable CIB-LCSA year-end balance
amounting to PhP16,766.98 million due
to: (a) discrepancies of PhP500.69 million
between the balances per books and per
bank of various savings accounts;
(b) delayed submission of BRSs to prove
the correctness of some savings accounts
amounting to PhP15,721.42 million;
(c) inclusion of dormant ATM savings
account of PhP6.7 million unconfirmed
by the bank; (d) negative or abnormal
credit balance of PhP161.18 million of
the Judiciary Development Fund (JDF)
Main Savings Account; (e) unadjusted
book reconciling items of PhP487.13
million and erroneous deductions of
PhP9.97 million in the bank balance in
the BRSs; (f) unrecorded collections and
deposits of PhP917.73 million; and
(g) unreported deposits of undetermined
amount caused by delayed/non-
253
submission of RCDs by SCOs
nationwide;
 Various Receivable accounts amounting
to PhP3.55 million remain recorded in the
books for more than 10 years, of which
the amount of PhP3.52 million had no
details or supporting documents and
described only as “For Reconciliation”,
“Beginning Balances” or “General”,
casting doubt as to their validity and
rendering the affected Receivable
accounts unreliable;
 Unreliable Due from the NGAs account
balance of PhP298.16 million due to:
(a) unreconciled balance of PhP261.68
million compared with the corresponding
payable account recorded in the books of
the Procurement Service-Department of
Budget and Management (PS-DBM), and
(b) unrecorded deliveries of supplies of
PhP64.47 million from the PS-DBM for
CY 2017 resulting in overstatement of the
account and understatement of related
Inventory accounts;
 Unreliable Due from LGUs account year-
end balance amounting to PhP94.21
million due to: (a) non-maintenance of
SLs for the account in the eNGAS; and
(b) unsupported book adjustments of
PhP60.61 million;
 Unreliable Inventories accounts balance
amounting to PhP443.15 million due to:
(a) incomplete RPCI raising doubts as to
the accuracy of recorded inventories;
(b) unreconciled balance amounting to
PhP7.40 million between PHILJA’s
accounting records and corresponding
RPCI; (c) incomplete and outdated Stock
Cards (SCs) which hamper reconciliation
with accounting records; (d) inclusion of
“For Reconciliation” SLs with balances
amounting to PhP152.52 million without
details; (e) unrecorded deliveries from the
PS-DBM amounting PhP64.47 million of
the Lower Courts; (f) semi-expendable
properties amounting to PhP366.15
million misclassified under PPE accounts;
and (g) existence of SLs with abnormal
credit balances aggregating PhP2.13
million;
 Unreliable PPE accounts year-end
balance amounting to PhP5,615.58
million due to: (a) failure of Management
to complete the physical count of various
PPE costing PhP906.77 million thereby
casting doubt on the physical existence
and condition thereof; (b) unreconciled
balance aggregating to PhP1,654.55
million between accounting and property
records of various PPE accounts recorded
in the SC books; (c) inclusion of “For
Reconciliation” SLs without details with
a net debit balance of PhP534.19 million;
(d) inclusion of semi-expendable
254
properties worth PhP366.15 million; and
(e) misclassification of accounts
amounting to PhP1.65 million; CIP-
Building and Other Structures account of
PhP79.75 million was not supported by
documents while completed projects
costing PhP2.43 million were still
recorded under the CIP account; the
Property Acknowledgement Receipts
(PARs) or Acknowledgement Receipt for
Equipment (AREs) issued for various
PPE were not renewed every three years;
 Unreliable Liability accounts year-end
balance due to: (a) existence of negative
or abnormal debit balances of PhP211.23
million; (b) dormant/long outstanding
payables of PhP37.16 million, which
should have been reverted to
Accumulated Surplus pursuant to Section
98 of PD No. 1445; (c) “For
Reconciliation” and “Various” SLs
without details amounting to a negative or
net debit balance of PhP10.03 million;
and (d) unremitted GSIS contributions
and loan amortizations of employees for
the month of November 2017 amounting
to PhP116.62 million; over-remittance of
taxes of PhP25.52 million caused by
systems error in the computation of tax
remittances resulted in the abnormal debit
balance of the Due to BIR account in the
Regular Agency Fund of the SC; and
 Tax deficiencies on the JDF’s additional
COLA has accumulated to PhP241.876
million computed as of 30 June 2017 due
to the continued non-withholding of taxes
on the subject allowance granted in CYs
2017 and 2016, except those paid to
Justices, Judges and some employees.
TOTAL 5 3 1
Note: Management Letters were issued to: (1) Civil Service Commission, (2) Career Executive Service Board, and
(3) Commission on Elections
Cluster 4 – Defense and Security
1. Department of the   Misstated CIB-LCCA balance of
Interior and Local PhP747.90 million as at year-end due to:
Government (DILG) (a) unadjusted book reconciling items and
accounting errors amounting to PhP0.51
million; and (b) delayed/non-preparation of
bank reconciliation statements in Central
Office and in four regions; and unutilized
funds/excess fund balances amounting to
PhP79.87 million intended for the
implementation of projects, programs and
activities for CYs 2014 to 2017 of four
regions were not remitted to the Bureau of
the Treasury;
 Reliability of the balance of Receivables
accounts amounting to PhP15.17 billion
255
cannot be ascertained due to: (a)
discrepancy of PhP482.39 million between
the balances per books of DILG and the
Implementing Agencies (IAs); and
(b) inclusion of dormant balances
amounting to PhP585.99 million; and
failure to strictly monitor the liquidation of
fund transfers which resulted in the
accumulation of huge balance at year-end;
 Doubtful balance of the Due from NGAs-
PS-DBM in the Central Office and NCR
aggregating PhP62.49 million as at year-
end due to: (a) accounting errors
(b) unsupported recorded deliveries of
PhP0.15 million; it includes unutilized or
excess balances amounting to PhP59.44
million in the Central Office and PhP0.21
million in NCR for undelivered supplies
and equipment and transfers amounting to
PhP2.84 million made during the last
quarter of CY 2017;
 Doubtful accuracy of the Due to NGAs
account balance amounting to
PhP169.01 million as of 31 December
2017 due to: (a) discrepancy of PhP62.76
million between the balance per books and
the confirmed balances with the source
agencies; (b) accounting errors amounting
to PhP15.83 million in Central Office and
in NCR which resulted in the
overstatement of the Due to NGAs account
and the understatement of various accounts
by the same amount; and (c) inclusion of
dormant accounts amounting to PhP0.48
million without supporting documents; and
 Doubtful accuracy of the balance of the
PPE accounts aggregating PhP914.49
million, net of depreciation, as at year-end
due to: (a) inclusion of untitled land and
building valued at PhP34.49 million;
(b) discrepancy of PhP127.77 million
between the balances per books and per
RPCPPE in Central Office and in two
regions; and (c) inclusion of PPE costing
PhP0.92 million already transferred to
Regional Offices (ROs) which resulted in
the overstatement of the PPE accounts and
Accumulated Surplus/Deficit account by
Php0.923 million and PhP0.779 million,
respectively, and the understatement of the
Subsidy to Regional Offices account by
Php0.14 million; unserviceable properties
with aggregate value of PhP125.08 million
remained not disposed.
2. National Police   Misstated CIB-LCCA balance of
Commission PhP218.68 million due to non-reversion to
(Napolcom) the cash balance of the amount of
unreleased checks amounting to PhP0.12
million resulting in the understatement of
the account by the same amount;
 Accuracy and existence of the PPE
accounts aggregating PhP2,578.95 million
as of 31 December 2017 cannot be
256
ascertained and relied upon due to: (a) the
inclusion of the borrowing cost amounting
to PhP90.02 million to the value of land
and building acquired from the Bangko
Sentral ng Pilipinas (BSP); (b) non-
reconciliation of accounting and property
records with discrepancies amounting to
PhP8.77 million; and (c) inadequate
provision for depreciation amounting to
PhP0.58 million;
 Accounts Due to NGAs of PhP95.3
million, Rent Expense of P0.15 million,
and Subsidy from Central Office of
PhP0.77 million were overstated while the
accounts Trust Liabilities of PhP95.3
million, Prepaid Rent of PhP0.15 million
and Accumulated Surplus of P0.77 million
were understated due to erroneous
recording of transactions; and
 Other Payables account balance of
PhP18.89 million as at year-end was
overstated by PhP6.31 million due to the
inclusion of rental income from the lease
of wall space of the NAPOLCOM Central
Office building amounting to PhP2.28
million and accounting error of PhP4.03
million caused by the advance payment by
NAPOLCOM of DILG’s share in the
insurance premium of the building
resulting in the understatement of the
Lease/Rent Income account by PhP2.28
million and the overstatement of the
Insurance Expense account by PhP4.03
million.
3. Bureau of Fire   Unremitted Fire Code Realty Tax by the
Protection (BFP) City Government of Manila amounting to
PhP65.16 million was not taken-up in the
books under the Due from LGUs account;
 Inaccurate balance of the Inventory
due to: a) outright charging of purchases to
the expense account and erroneous
recording of semi-expendable Disaster
Response and Rescue equipment as
Inventory instead of PPE; b) recording of
semi-expendable properties under a lower
value instead of the acquisition cost;
c) non-recording of issuances or
distributed semi-expendable properties;
and d) failure to conduct physical count of
inventories and non-preparation/late
submission of the RPCI; and
 Inaccurate reported balances of the PPE
amounting to PhP5,411.43 million due to:
a) outright charging of major repairs and
purchases to expenses; b) non-recording of
donated fire trucks; c) non-derecognition
of damaged and unserviceable properties;
d) properties which title/registration are
not transferred to BFP; e) unreconciled
discrepancies between Accounting
Records and balances per RPCPPE; and
f) missing PPE at the time of the physical
count.
257
4. Local Government   Unrecorded bank deposits amounting to
Academy (LGA) PhP0.33 million, nature of which could not
be identified; and
 Doubtful accuracy, reliability and
existence of the reported balances of the
PPE accounts amounting to PhP41.84
million at year-end due to: (a) non-
submission of CY RPCPPE;
(b) undocumented adjustments in various
PPE and other related PPE accounts; and
(c) absence/unupdated of PPELC & PC.
5. Bureau of Jail   CIB-LCCA–LBP amounting to PhP11.54
Management and million was understated by PhP9.88
Penology million (net understatement) due to
(BJMP) non-recording of various book’s
reconciling items and bank errors dating
from CY 2004 to CY 2017 of PhP0.09
million which are still not adjusted by the
bank; and
 Inaccurate PPE year-end balance of
PhP1,556.61 million (net of depreciation)
due to various deficiencies noted.
6. Philippine Public   Reliability and accuracy of the year-end
Safety College balance of the CIB-LCCA cannot be
(PPSC) ascertained due to the non-reconciliation of
book balance amounting to PhP118.23
million with the bank balance of
PhP119.94 million caused by the non-
preparation of BRSs; and
 Unreliable accuracy and existence of the
PPE accounts due to inclusion of
unserviceable properties amounting to
PhP19.10 million in the PPE accounts.
Major repairs/improvements in the amount
of PhP6.60 million were expensed instead
of capitalized.
7. Philippine National   Errors and deficiencies noted in
Police (PNP) transactions and accounts involving Fuel,
Oil and Lubricants (FOL) inventories and
the Military, Police and Traffic Supplies
Inventories affected the accuracy and
reliability of the total Inventories of
PhP2.36 billion, such as: (a) failure to
conduct physical count of inventories and
submit the report; (b) recording of fuel and
ammunitions purchased as outright
expenses; (c) unrecorded prior years’
deliveries; (d) delayed or non-submission
of Requisition and Issue Slip (RIS) and
RSMI; and (e) non-maintenance/updating
of SCs and SLCs;
 Misstated balance of Due to NGAs account
of PNP National Headquarters amounting
to PhP34.22 million due to erroneous
treatment of collections from Philhealth
amounting to PhP15.63 million; the
account includes the unexpended balance
of completed project of PhP3.29 million
not returned to the Source Agency (SA);
and unliquidated fund transfers amounting
to PhP12.57 million by the implementing
PNP units/offices;
 Correctness, existence and ownership of
258
the PPE accounts amounting to PhP24.14
billion could not be ascertained due to the
following errors and deficiencies noted:
(a) unrecorded transfer of equipment by
the National Headquarters of PhP53.87
million; (b) improper/unsupported
dropping of motor vehicles costing
PhP71.48 million; (c) non-recording of
receipt of Mahindra vehicles costing
PhP64.10 million; (d) non-recognition of
Loss of Assets and Impairment Loss
(e) non-reclassification of finished
construction projects to proper PPE
accounts amounting to PhP148.72 million.
8. Department of   Unreliable Due from NGAs and GOCCs
National Defense account balance amounting to PhP405.01
(DND) million due to discrepancies of PhP12.61
million between the DND books and the
Implementing Agencies noted in the
confirmation of balances;
 Unreliable Inventory accounts balances
amounting to PhP47.51 million due to the
unreconciled difference of PhP27.4 million
between the balance per book and the
RPCI partly due to unrecorded receipt and
issuance of inventories amounting to
respectively;
 Unreliable PPE accounts reported balance
of PhP172.22 million due to non-dropping
from the books of accounts PPEs disposed
of as of 20 July 2017 amounting to
PhP15.53 million.
9. National Defense 
College of
the Philippines
(NDCP)
10. Office of Civil   Doubtful validity of Due from NGAs,
Defense (OCD) LGUs and GOCCs Accounts balances in
the total amount of PhP1.09 billion due to
unreconciled balances of PhP25.39 million
between the books of OCD and eight
implementing agencies; and dormant
accounts of PhP16.75 million,
collectability of which is uncertain.
 Doubtful reliability of Due from GOCCs
account due to existence of unaccounted
discrepancy between NFA and OCD books
of accounts in the amount of PhP25.88
million as at year-end;.
 Unreliable PPE accounts due to:
(a) unserviceable PPEs amounting to
PhP4.08 million recorded under Other
Assets and were not reverted to PPE
accounts; (b) non-periodic reconciliation of
accounting and property records; and,
(c) failure to complete inventory-taking of
PPE during the year; and Property
Acknowledgement Receipt (PAR) was not
renewed every three years;.
 The frequent travels of the Accountable
Officers who lacked the time to look into
259
the liquidation of the cash advances (CAs)
as well as to attend to the deficiencies
noted in its liquidation resulted in the
accumulation of outstanding cash advances
 Payment of meal allowance to duty
officers in the Operation Center of OCD-
NCR is without legal basis; thus,
disallowed in audit.
11. Veterans Memorial   Accuracy of the CIB-LCCA as of
Medical Center 31 December 2017 in the amount of
(VMMC) PhP465.92 million could not be
ascertained due to the delayed submission/
preparation of BRSs;
 Three Cash-MDS accounts balances were
overstated by PhP1.33 million due to
erroneous adjustment of unreleased
checks;
 Due from NGAs account balance of
PhP16.59 million was overstated by
PhP15.15 million due to: (a) inclusion of
the fund transfer made to Philippine
International Trading Corporation (PITC);
(b) inclusion of unreleased/staled checks
amounting to PhP20,906.30; and
(c) unrecorded deliveries amounting to
PhP124,887.50.
 Collectability of Due from Officers and
Employees amounting to PhP1.31 million
could not be ascertained due to various
lapses and inconsistencies in the
implementation of the Hospital
Memorandum No. 2001-520-282, Change
III dated 5 June 2015; doubtful accuracy of
account balance due to over-deduction
made from employees amounting to
PhP9,493.37, unclassified receivables from
retired/resigned employees of PhP0.94
million and unrecorded receivables of
PhP0.64 million;
 Lapses in the billing and collection process
on unpaid bills of pharmaceutical
companies conducting clinical researches/
trials in the Center resulted in the
accumulation of unbilled utility charges
 Advances to Contractors and Accumulated
Surplus/Deficit accounts balances were
erroneous recognition of payments made
for the customized uniforms of officers and
employees; and
 Accounts Payable reported balance
understated by PhP4.15 million due to
erroneous recognition of fund balance and
non-recording of adjustment to correct the
negative balance of the SL account.
12. Philippine Veterans   Accumulation of idle funds with LBP to an
Affairs Office aggregate amount of PhP72.512 million as
(PVAO) of 31 December 2017 due to continuous
remittance of monthly pension of
beneficiaries by the Finance Division
260
despite the blocking order due to
pensioner’s failure to comply with the
PVAO’s revalidation program and/or
inclusion in the List of terminated pensions
by reason of death, remarriage and fraud;
the existing Integrated Veteran Database
Management (IVDMS) was unreliable due
to discrepancies and inconsistencies noted
on the date of suspension, termination and
resumption for those pensioners receiving
two types of pension claims which added
to the condition of huge bank balances;
 Fund transfers to various NGOs/POs were
not compliant with COA Circular No.
2007-001 dated October 25, 2007 due to:
(a) the granting of additional fund transfers
of PhP4.05 million despite the non-
liquidation of previous fund transfers;
(b) absence of data/information required to
be present in the Memorandum of
Agreement (MOA); and (c) lack of
documentary requirements;
 Validity and accuracy of PPE accounts
amounting to PhP439.68 million could not
be ascertained due to: a) discrepancies
noted in the reported value of E-Jeeps
amounting to PhP0.27 million; b) absence
of documents to support the adjustments
made in the office equipment which were
both credited and debited amounting to
PhP3.52 million; and c) maintenance of
subsidiary ledger - unreconciled office
equipment amounting to PhP36.62 million;
and
 Erroneous classification under Repairs and
Maintenance – Other Property Plant and
Equipment Account of the two
transformers purchased in CY 2017 and
FY 2011 amounting to PhP0.49 million
resulted in the understatement of the Power
Supply Systems account; five transformers
amounting to PhP0.23 million were
classified under Other PPE Account
instead of Power Supply Systems account.
13. Armed Forces of   Lack of coordination and monitoring
the Philippines- procedures on the flow of transactions by
General the concerned Offices and AFP
Headquarters Accounting Center resulted in accounting
(AFP-GHQ) errors, omissions and deficiencies which
affected the fair presentation of balances in
the FSs.
14. AFP-Commissary   Non-recognition of impairment loss on
and Exchange past due Receivables amounting to
Service PhP22.19 million as of 31 December 2017;
(AFPCES) and these receivables remained outstanding
in the books due to non-availability of
documents to support existence and
majority of these receivables are dormant
aged two to 33 years which pertains to
accountable officers that are no longer in
active service, AWOL and deceased; thus,
collectability of the accounts is uncertain;
 Unreliable Merchandise Inventory and
Cost of Sales account balances of
261
PhP448.45 million and PhP2,458.3
million, respectively due to: (a) absence of
reconciliation of balances per GL, SL and
RPCI resulted in the net difference of
PhP5.885 million between year-end
inventory report and reported ending
inventory of outlets, and (b) expired
inventories costing PhP0.68 million not
written off from the books of account; and
 Unreliable PPE balance amounting to
due to: a) erroneous capture of prior years’
financial transactions amounting to
PhP1.74 million, b) inclusion of motor
vehicles registered under the name of
private individuals costing PhP1.38
million, c) unfinished physical count and
non-preparation/submission of the yearly
RPCPPE, d) non-maintenance of PCs; and
non-issuance/updating of PAR.
15. Philippine Army   CIB-LCCA balance of PhP1,057.16
(PA) million is misstated by PhP9.12 million
due to unrecorded reconciling items as at
year-end;
 Stale checks and cancelled List of Due and
Demandable Accounts Payable – Advice
to Debit Account (LDDAP-ADA)
amounting to PhP4.96 million and PhP1.12
million, respectively, for a total of PhP6.08
million were not recognized and reverted
to the Cash – MDS, Regular as at year-
end;
 Unreliable Advances for Operating
Expenses, Advances to Special Disbursing
Officers, Advances for Payroll and
Advances to Officers and Employees
accounts of the Philippine Army balances
in the total amount of PhP101.29 million
due to: (a) delayed/non-submission of
liquidating documents, and (b) misstated
balance of the Advances for Operating
Expenses account amounting to PhP73.19
million of the HPA;
 Unreliable Due from NGAs (PS-DBM)
account balance in the total amount of
2018 due to unrecorded fund transfer,
deliveries, adjustments and unreconciled
discrepancy existing in the books of the
Agency and PS-DBM amounting to
PhP113.55 million; and long outstanding
advances to Government Arsenal and PS-
DBM ranging from more than one year to
more than three years due to: (a) delays in
the supply and delivery of goods and
services by PS-DBM; (b) non-immediate
refund of the unspent balances for
subsequent remittance to the Bureau of
Treasury; and (c) slow rate of deliveries by
Government Arsenal equivalent to only 25
per cent of the required delivery;
 Accuracy and reliability of the balance of
FOL Inventory amounting to PhP940.15
million could not be ascertained due to:
262
(a) unrecorded deliveries/issuances;
(b) absence of physical count; (c) non-
adherence to the Weighted Average
Method of costing inventories; and
(d) non/improper maintenance of supplies
ledger card and stock card; and correctness
of the reported fuel consumption could not
be ascertained due to inadequate control
measures to control and monitor
effectively the fuel issuances;
 Delayed project implementation of 19
projects programmed for CYs 2015 and
2016 due to absence of provision on
project timelines in the MOA by and
between DND and Petron Corporation on
the use of RMC Funds; and the
unreconciled difference between AQM and
Petron Corporation records amounting to
PhP4.02 million and the unrecorded
balance of RMC Fund and equipment
delivered to the PA amounting to
respectively renders the balance of RMC
Funds unreliable;
 Accuracy and reliability of the Inventory
accounts balance in the total amount of
PhP7.46 billion cannot be ascertained due
to: a) unrecorded issuances, b) inclusion of
undetermined items classified under
Military, Police and Traffic Supplies
Inventory, c) unaccounted discrepancy of
PhP2.52 billion, d) recording of
inventories as expenses upon purchase, and
(e) failure to submit and maintain property
reports and records; and lack of common
reference for each reported inventory in the
accounting and property records resulted in
the difficulty of conducting the
reconciliation of both records;
 Unreliable Due to NGAs account balance
of PhP758.83 million due to:
(a) unaccounted discrepancy of PhP551.97
million between the records of the
HPA and four NGAs,
(b) delayed/non-submission of liquidating
documents by the implementing units and
unrecorded liquidations by the HPA and
unreverted residual amount to the source
agency, (c) non-derecognition of liability
of PhP3.85 million under the Kawal
Kalinga Fund, and (d) unremitted interest
income as at year-end;
 Accuracy and reliability of the balance of
PPE accounts under Regular, BCDA, Trust
Funds and Internally Generated Fund
(IGF) in the total amount of PhP107.61
billion cannot be ascertained due to:
(a) discrepancy between the Accounting
and Property records, (b) undocumented
land amounting to PhP270.6 million,
(c) non-reclassification of PPE accounts
with cost below PhP15,000.00
capitalization threshold amounting to
PhP9.64 million, and (d) misstated balance
263
of the Land account due to revaluation;
and PPE amounting to PhP3.25 million
procured thru Small Value Procurement
were delivered and accepted during the
year but not recorded by ASPA or 15th
FPAO in their respective books of
accounts;
 Completed Projects in HPA and
MID/TRADOC amounting to PhP340.12
million recorded under Construction in
Progress – Building and Other Structures
account under the BCDA Fund and
Regular Fund were not reclassified to their
proper PPE accounts; and, 15 projects
amounting to PhP26.05 million taken up
under Construction in Progress account
were not found in the records of OACE;
 Unserviceable PPEs amounting to
PhP210.18 million were not dropped from
the books; and other structures constructed
between the years 1995 and 1998
amounting to PhP79.23 million already
destroyed by fire in 1998 and lost
properties amounting to PhP0.72 million in
3rd ID were not derecognized in the books
as at year-end;
 Doubtful accuracy and reliability of the
Motor Vehicles account under Regular and
BCDA Funds as of 31 December 2017 in
the total amount of PhP2,461.63 million
due to the discrepancy of PhP5.81 million
between the accounting and property
records; inconsistencies were noted in the
recording/maintenance of motor vehicles;
and
 Misstated balance of DLC account
amounting to PhP1,815.998 million by
PhP227.18 million due to: (a) inclusion of
completed projects/delivered goods and/or
services; (b) unrecorded residual balances
of LCs and other adjustments; (c) inclusion
of the improperly classified bank debit and
credit transactions for UCPB Account; and
(d) non-return/refund to the Agency of the
LC balances for terminated contracts.
16. Philippine Air   Erroneous transfer of cash amounting to
Force (PAF) PhP133.56 million intended for PAF
Commercial Claims and PAF Variable &
Collateral System unnecessarily bloated
the account of PAF ATM Payroll account
resulting in inaccurate balance at year-end;
and cash balance of prior years’
obligations without valid claimants and
dormant balances amounting to PhP5.66
million and PhP80.80 million, respectively
were not reverted to the BTr;
unreliable due to: a) long outstanding
uncollected and/or non-moving receivables
amounting to PhP15.71 million, and b)
collection inefficiency in HPAF;
amounting to PhP3.14 billion due to:
264
a) incomplete RPCI, b) discrepancy of
PhP0.992 million between the GL balance
of the Drugs and Medicines Inventory
account with that of the RPCI in HPAF, as
disposal of expired drugs and medicines in
ABAB was not properly inspected and
documented, c) non-recognition of
expenses when inventories were actually
incurred in CAB, AETDC and 15th Strike
Wing, and d) improper/partial application
of the Perpetual Inventory System and
Inventory Accounting System and outright
recognition of FOL expense;
 Unreliable PPE accounts balances
amounting to PhP60.73 billion as of
31 December 2017 due to: a) inaccurate
recognition of Land in the books of 15th
Strike Wing and ABAB, b) various PPEs
transferred from HPAF and actually used
in the field bases (intra-agency transfers)
were still recorded in the books of
accounts of HPAF and PPEs received by
ABAB from Western Command was
recorded at cost instead of the net carrying
value at the date of transfer, c) non-
recognition of depreciation for Office
Buildings and Land Improvements due to
absence of details/breakdown,
d) unrecorded PPEs in the books of CAB
and BAB, e) improper recording of major
repairs and betterments as outright
expense, and f) tangible items below the
capitalization threshold of PhP15,000
(semi-expendable properties) recognized
as PPE in HPAF;
 Unreliable CIP account amounting to
PhP532.80 million due to inclusion of five
completed projects that should have been
reclassified to appropriate PPE account
and absence of details/breakdown and
supporting documents of the recorded
constructions in progress; and
 Deposit on Letters of Credit account
amounting to PhP1.15 billion showed a
discrepancy between the books and bank
balances of PhP47.57 million due to
unrecorded utilization/ drawdowns;
inclusion of residuals representing
liquidated damages from completed
project; and Surety Bond for Terminated
Contracts/Blacklisted Supplier not
forfeited.
17. Philippine Navy   Unreliable CIB-LCCA account balance of
(PN) PhP327.46 million as of 31 December
2017 due to: (a) inclusion of two closed
bank accounts; and (b) various unadjusted
reconciling items in the BRS of Integrated
Payroll Management System (IPMS) Bank
Account No. 3, resulting in net
overstatement of PhP25.33 million;
 Unreliable Inventories account balance
31 December 2017 due to various
deficiencies, such as: a) failure of the
265
FSPAO to submit the RSMIs to FASU;
b) simultaneous recording of the delivery,
issuance and payment of purchased
inventories; and c) recording of inventories
as expenses on the following month; and
 Unreliable PPE accounts balance
31 December 2017 due to: a) recording of
the acquired simulation system and
communication equipment of PhilFleet
amounting to PhP21.1 million as
Inventories instead of the correct PPE,
b) recognition of some PPE transferred by
other PN units for repairs, c) erroneous
recording of watercrafts account, and
d) failure to prepare the Report of Lost,
Stolen, Damaged, Destroyed Property
(RLSDDP) for lost assets during
operations.
18. Department of   Unreliable CIB-LCCA balance of
Justice (DOJ) PhP160.83 million due to deficiencies
noted in C/A No. 0592-1060-51-ATM:
undocumented transfer of funds of
PhP621.65 million; unadjusted reconciling
items of PhP33.46 million; double
recording of fund transfer of PhP0.16
million; and three bank accounts were
maintained with LBP without authority;
 Unreliable Inter-Agency Receivables and
Other Receivables accounts balances of
respectively, due to: a) dormant accounts
PhP1.73 million, respectively, carried in
the books for more than 10 years and the
collectability of which could no longer be
ascertained, b) management to collect the
receivables from their personnel on the
overpayment of salary paid to them in CYs
2014 to 2017 amounting to PhP1.29
million, and c) transferred funds to the
PS-DBM in CY 2015 amounting to PhP53
million remained unliquidated, keeping
government resources idle for two years;
 Validity, accuracy and completeness
inventory accounts balances amounting to
PhP12.08 million cannot be ascertained
due to: (a) existence of PhP4.54 million
worth of Other Supplies and Materials
Inventory without corresponding
breakdown or details, (b) erroneous
recording of semi-expendable supplies to
Other Supplies Inventory Expense account
amounting to PhP0.91 million, (c)
unreconciled Office Supply Inventory and
Accountable Forms Inventory records of
Accounting and Supply Section amounting
to PhP1.56 million and PhP0.02 million,
respectively, and (d) inventory items
recorded as outright expense amounting to
PhP0.41 million;
 Unreliable PPE accounts balances
(a) non-submission of complete RPCPPE,
266
(b) presence of balances in the amount of
PhP76.17 million “For Reclassification”,
and (c) non-transfer of completed Hall of
Justice to the Supreme Court of the
Philippines; and
 Cost of completed construction/renovation
projects amounting to PhP6.49 million
unreclassified to the Buildings account,
resulting in overstatement and
understatement of CIP-Buildings and
Structures and Buildings, respectively by
the same amount; and completed
construction/ renovation projects with total
contract cost of PhP106.99 million were
not yet reclassified to the Buildings
account due to delayed and slow
processing of final progress billings/
payment amounting to PhP13.59 million.
19. Bureau of   Unreliable CIB-LCCA account balance of
Immigration (BI) PhP184.51 million due to discrepancy of
PhP4.54 million between the books and
banks’ records resulting from unadjusted
book reconciling items of PhP0.75 million
and unreconciled difference of PhP3.79
million; and unremitted collections from
cash bond, accreditation fees, seminar fees
and Inter-Agency Fund Transfers during
the year amounting to PhP44.32 million to
the BTr;
 Unrecorded balances amounting to
PhP11.78 million of four bank accounts
maintained at the LBP resulting in the
understatement of the CIB account as at
year-end;
 Unreliable CIB-LCSA balance amounting
to PhP55.9 million due to understatement
in recording the remittances by PhP35.96
million, unrecorded interest of PhP0.49
million and erroneous recording of
adjustment of PhP0.19 million; and the
BRSs were not prepared and submitted
within the period because of delayed
receipt of bank statements;
 Unreliable Accounts Receivable account
due to inclusion of dormant accounts of
PhP0.1 million (net of Allowance for
Impairment of PhP5,054.95) and
unrecorded receivables of PhP188.09
million; and prior year collection
amounting to PhP50,000.00 remained
unadjusted;
 Due from NGAs (PS-DBM) account
balance amounting to PhP25.48 million as
of 31 December 2017 differs with the
balance confirmed by PS-DBM by
deliveries of PhP1.33 million; and
unadjusted reconciling items of PhP1.33
million; and unutilized advances has
accumulated to PhP22.81 million;
 Doubtful validity of PhP7.3 million or 98.3
percent of the Other Receivables account
of PhP7.43 million since it has been
267
outstanding for more than five to 35 years
and the accountable officers were no
longer connected with the Bureau; and
Management did not recognize an
allowance for impairment loss;
(a) non-submission of RPCI,
(b) discrepancy of PhP19.34 million
between the GL and SLC, (c) existence of
dormant account, and (d) recording of
purchases as outright expense;
 Existence, condition and reliability of PPE
accounts amounting to PhP1.07 billion
cannot be ascertained because of the
absence of complete physical inventory of
PPEs; and the following deficiencies were
also noted: (a) PPELCs and PCs were not
maintained, making the reconciliation
thereof not possible; (b) equipment
purchased in the current year were not
provided with depreciation resulting in the
understatement of Depreciation Expenses
and Accumulated Depreciation by
PhP5.284 million; and (c) undisposed
unserviceable properties found in prior
years amounting to PhP3.44 million; and
 Unreliable Other Payables account balance
of PhP46.38 million as of 31 December
due to: (a) presence of negative and
dormant/non-moving ledger balances of
respectively, (b) erroneous recording
amounting to PhP36.64 million, and
(c) absence of details/schedules for the six
other payables account.
20. National Bureau of   Unreliable Due to GOCCs account balance
Investigation (NBI) of PhP26.996 million due to: (a) non-
existent balance of PCSO amounting to
PhP12.95 million, (b) misclassified
Philippine Anti-Graft Commission
(PAGC) balance of PhP3.74 million, and
(c) balance of PhP8.999 million as “For
Adjustment”.
 Due from Officers and Employees, Due to
Officers and Employees and Advances to
Special Disbursing Officers (SDOs)
accounts balances included abnormal
account balances amounting to PhP5.1
million, respectively;
 Double recording of liquidation reports of
petty cash fund resulted in negative
subsidiary ledger balances and
accordingly, understatement of the Petty
Cash account in the amount of PhP0.54
million; and
 FOL Inventory account balance of PhP0.18
million was overstated by PhP0.14 million
compared to the balance of PhP0.04
million per physical inventory due to
unrecorded issuances of FOL products.
21. Parole and 
Probation
268
Administration
(PPA)
22. Land Registration   Unreliable Due from NGAs account
Authority (LRA) balance amounting to PhP26.41 million
due to discrepancy of PhP4.06 million
between the book balance of the LRA and
LRA-CARP and the PS-DBM account, and
overstatement of PhP5.15 million resulting
from misclassification of the amount
pertaining to collections of the Clerks of
Court;
 Receivables - Disallowances/Charges
million is understated by PhP30.18 million
due to unrecorded disallowance which has
become final and executor, and overstated
by PhP0.66 million due to unrecorded
employee’s salary deduction, resulting in
net understatement of PhP29.52 million;
 Unreliable Inventory account balance
(a) unreconciled differences between the
book balance and the physical inventory
amounting to PhP0.31 million and PhP5
million for the Office Supplies and
Accountable Forms Inventory accounts,
respectively, (b) overstatement of General
Ledger (GL) balance amounting to
issuance of supplies, and (c) use of
purchase price instead of weighted average
costing of inventories; and
 Doubtful existence, accuracy, and validity
PPE account balance amounting to
PhP727.97 million due to: (a) lack of
reconciliation of records between the
Accounting and Property and Supply
Sections, (b) unrecorded loss of PPE
amounting to PhP0.73 million, and
(c) understatement of the PPE account by
PhP30.38 million.
23. Public Attorney’s   Unidentified reconciling amount of
Office (PAO) PhP0.698 million existed between PAO
books and PS-DBM records rendering the
account unreliable;
 Validity, accuracy and reliability of PPE
(net of accumulated depreciation) cannot
be ascertained due to: a) non-submission
of RPCPPE for CY 2017, b) non-
recording/erroneous recording of disposed
unserviceable properties resulting in net
overstatement of PhP8.54 million; and
 Due to GSIS account balance could not be
ascertained due to unreconciled
remittances amounting to PhP1.47 million
between total remittances per GL and the
total remittances per Official Receipts
(ORs) issued by the GSIS.
24. Office of the   Accuracy of the CIB-LCCA and CIB-
Solicitor General FCSA balance amounting to PhP8.04
(OSG) million and PhP0.31 million, respectively,
could not be established due to:
269
(a) unadjusted deposit in transit amounting
to PhP0.06 million and erroneous entries in
the books of PhP0.01 million;
(b) discrepancy between the book and bank
balances; and (c) non preparation and late
submission of BRSs, thereby, resulting to
the understatement/overstatement of the
CIB accounts; and
 Doubtful accuracy and reliability of PPE
due to: a) discrepancy of PhP5.71 million
between the books and RPCPPE; and b)
incomplete PPELCs and PCs.
25. Office of the 
Government
Corporate Counsel
(OGCC)
26. Presidential   Unrecorded withdrawal of US$5 million or
Commission on PhP251.99 million resulted in the
Good overstatement of CIB – FC account while
Government the unsubmitted documents from PNB
(PCGG) Retained Fund covering transactions from
1 October 2016 to 31 December 2017
gave rise to the doubtful balance of the
account; documents supporting the
disbursements amounting to US$2.985
million or PhP30.32 million were not
submitted to the audit team; hence,
suspended/disallowed in audit;
 Doubtful Investment in Stocks account,
with recorded shares of stocks of 17
companies, showed a discrepancy of
450,994,786 shares of stocks or PhP218.86
million from the actual inventory taking
conducted;
 Unreliable Abandoned/Surrendered
Property/Assets account balance
amounting to PhP14.82 billion due to:
a) absence of clear-cut policy and
guidelines on the recording of assets
between PCGG and IBC books which
resulted in recording of assets both in the
PCGG books and the surrendered
corporations’ books, and b) failure to
present Transfer Certificate of Titles
(TCTs) during the inventory taking; and
 Prepaid Insurance account was overstated
by PhP0.104 million while the Other
Prepayment was understated by PhP0.10
million and the Accumulated Surplus/
Deficit by PhP0.003 million.
27. Bureau of Corrections   Erroneous recording of the Annual

(BuCor) Guaranteed Production Share collected by
BuCor from TADECO amounting to
PhP35.33 million under a Joint Venture
Agreement to Other Receivables account
instead of Due from Joint Venture account
resulting in the overstatement of the Other
Receivable account and understatement of
Due from Joint Venture account by the
same amount;
 Unreliable account balance of the Due
270
from NGAs (PS-DBM) amounting to
PhP14.69 million due to: (a) discrepancy
of PhP3.94 million compared with the
balance of PhP10.75 million confirmed by
the PS-DBM caused by the non-recording
of fund transfer to PS-DBM amounting to
PhP0.65 million, and non-recording of
deliveries amounting to PhP0.79 million;
and (b) absence of proper monitoring of
deliveries resulting in the accumulation of
undelivered items amounting to PhP10.13
million, and failure to conduct regular
reconciliation with the PS-DBM;
 Unreliable Inventory accounts reported
balances amounting to PhP37.51 million
due to non-conduct of physical count of
inventories, absence of subsidiary records
and stock card, non-submission of RSMI,
erroneous recording, and absence of
effective security system for inventories;
 Doubtful PPE accounts balances
inadequate controls and lapses in property
management as well as erroneous and
incomplete recording of transactions of
IPPF and LRP;
 The Other Gains account representing
revenue under Fund 284 was overstated by
PhP3.6 million due to inclusions of
collections that should have been remitted
to the National Treasury; and
 Payment for services rendered by the
Consultants amounting to PhP2.24 million
charged to Other Professional Services
instead of Consultancy Services resulting
in the understatement of the Consultancy
Services and overstatement of Other
Professional Services by the same amount.
TOTAL 3 22 2
Cluster 5 – Education and Employment

1. Department of   Misstatements in Cash and Cash
Education (DepEd) Equivalents due to discrepancy of PhP1.13
billion between the Cash account balance
and as confirmed by the bank; and
erroneous/unrecorded transactions
 Unreliable Receivables balance due to:
(a) The account Due from NGAs - PS-
DBM with confirmation variance of
PhP4.47 billion with DBM-PS account
balance; dormant and long outstanding
accounts of PhP899.58 million; and errors/
omissions in recording fund transfers and
deliveries in the amount of PhP1.78
million; (b) Inclusion in the Inter/
Intra-Agency and Other Receivables
balances of dormant and long outstanding
accounts in the amount of PhP199.2
million, aged 10 years and over, pertaining
to unliquidated fund transferred to various
government agencies and NGOs;
271
confirmation variance of PhP28.3 million
with government agencies/NGOs’
balances; and unaccounted and
unsubstantiated balances of PhP122.52
million; and (c) Past due Loans Receivable
of PhP15.11 million that have been
outstanding for more than one to 15 years;
 Misstatements in the Inventory accounts
due to non-existing inventory items,
unrecorded issuances and utilization, and
various errors and omissions in recording
which overstated the account balance by
PhP44.91 million; and centrally/ regionally
procured items worth PhP4.51 billion
already distributed/transferred to end users
but remain accounted in the books of the
Central/Regional Offices;
 Inaccurate PPE accounts balances due to
unreconciled difference of PhP39.94
billion between the Accounting and
Property records; non-performance of
physical inventory to verify existence and
completeness of the reported assets worth
at least PhP23.48 billion; non-maintenance
of subsidiary records and existence of
undocumented PPE balances in the total
amount of PhP53.36 billion; and various
errors and omissions in recording
transactions affecting PPE accounts like
inclusion of semi-expendable items costing
at least PhP46.24 million, unrecorded
unserviceable/demolished/ razed by
fire/losses/transferred/disposed PPEs
amounting to PhP14.45 million,
unrecorded properties of PhP3.02 billion,
PPE items not yet dropped from the books
of accounts of Central Office (CO)/ROs of
PhP10.82 billion;
 Doubtful validity of Advances due to
existence of outstanding accounts in the
total amount of PhP1.45 billion granted to
officers and employees which remained
unliquidated as of year-end, hence, the
corresponding expenses incurred out of the
cash advances were not recognized in the
proper accounting period; existence of
unsubstantiated balances in the total
amount of PhP191.58 million; and errors
in recording of transactions in the amount
of PhP102.32 million; and
 Misstatements in the Liabilities due to
recognition of invalid claims pertaining to
undocumented payables of PhP107.32
million, inclusion of dormant/long
outstanding payables of PhP69.99 million,
and errors and omissions of entries
affecting the Liability accounts by PhP3.71
million.
2. University of the   Unreliable Cash in Bank, Local Currency
Philippines System Account balance amounting to PhP400.794
272
(UPS) million (net) due to various
unadjusted/unrecognized reconciling
items; and unreliable Cash-Collecting
Officers account balance amounting to
PhP2.10 million (net) due to
unrecorded/undeposited collections of
PhP1.73 million and variances amounting
to PhP0.37 million (net) between the
books and the accountable officers’ (AOs’)
records;
 Unreliable Due to Officers and Employees
account by PhP0.17 million (net) due to
negative account balances of 18 AOs
unrecorded liquidation reports amounting
to PhP0.5 million of nine AOs;
 Unreliable Accounts Receivable account
due to unrecorded sales of Newborn
Screening Kits of PhP60.18 million,
penalty of two percent amounting to
PhP2.97 million, and on-line collections of
PhP0.13 million; unreconciled variance of
PhP0.8 million between the GL and the
SLs and dormant accounts of PhP79.78
million, aged 10 to 70 years without
details/supporting documents;
 Unreliable Due from NGAs account
due to: a) non-maintenance of SLs for
accounts amounting to PhP101.9 million;
b) unreconciled variance of PhP2.85
million between the books and DBM-PS
records; and c) dormant accounts aged 10
to 17 years without supporting documents
 Unreliable PPE accounts amounting to
PhP1.214 billion due to:
a) error/unrecorded reconciling items
amounting to PhP12.23 million (net); b)
unreconciled variance of PhP1.03 billion
between the Property and Accounting
records; and c) PPE amounting to
PhP199.521 million unsupported with
PPELC/SL/RPCPPE;
 Overstatement of Accounts Payable and
the related Expense accounts both in the
total amount of PhP4.45 billion (net), due
to: a) payables with Constituent Units/
Offices as creditors and not supported with
adequate documentation amounting
PhP3.27 billion; b) payables outstanding
for more than two years and without proof
of actual claims on record, filed
DVs/payroll and supporting documents
amounting to PhP1.22 billion; c) non-
restoration of unreleased/unclaimed checks
at year-end to the cash and payable
273
and d) payables for services not yet
rendered/goods not yet delivered
 Understatement Due to NGAs account by
PhP101.13 million due to error in
recording; and
 Overstatement of Rent/Lease Income
account and understatement of Other
Deferred Credits account by PhP17.31
million (net) due to non-compliance with
the accrual basis of accounting for
unearned income amounting to PhP20.77
million.
3. Commission on   Understatement of the Loans Receivable –
Higher Education Others account by PhP17.35 million due to
(CHED) error in recording in CHEDROs CAR and
VIII, and the doubtful validity of the
amount of PhP8.96 million due to absence
of specific name of borrowers in
CHEDROs VIII and XIII;
 Overstatement of the Due from National
Government Agencies account by PhP1.49
million due to unrecorded liquidation, non-
adjustment of stale and cancelled checks
and other errors in CHED-CAR;
 Effect of the negative balance amounting
to PhP4.26 million to the consolidated
totals of the Due from NGOs/POs account
in CHED-NCR and dormant accounts of
PhP47.188 million in CHED-CO;
 Understatement of the Inventory accounts
by PhP0.44 million for failing to recognize
in the books the cost of security paper for
Certification, Authentication and
Validation in CHEDRO IV-A, and
overstatement by PhP0.37 million for
failing to record issuances of supplies in
CHEDRO XI;
 Net understatement of the PPE accounts by
PhP343.56 million due to the failure to
record delivered equipment in CHED-CO
and CHEDROs CAR and XI amounting to
PhP345.56 million, and PPEs with unit
cost below PhP15,000.00 amounting to
PhP2.004 million not reclassified as
Inventories in CHEDROs NCR, IV-B, XI
and XIII, and the unreconciled Report on
the Physical Count of PPE with the
recorded amounts in CHED CO and
CHEDROs III, XI and XIII with a total
variance of PhP230.25 million; and
 Overstatement of the Payable accounts by
PhP42.52 million due to the presence of
claims without sufficient supporting
documents and valid claimants and are
outstanding for more than two years in
CHED-CO, CHED-NCR and CAR.
4. Philippine Normal   Accuracy and existence of PNU-Manila’s
University (PNU) PPE accounts valued at PhP210.10 million
cannot be ascertained due to: a) incomplete
inventory-taking for the years 2015, 2016
and 2017; b) non-reclassification of
tangible items below the capitalization
274
threshold of PhP15,000.00; c) presence of
accounts with negative balances amounting
to PhP5.56 million; and d) correctness and
serviceability of the PPE of PNU North
Luzon with carrying amount of PhP25.86
million for CY 2017 cannot be ascertained
due to non-reconciliation of the PPELCs
with the PCs;
 Validity and correctness Accounts
Receivable and Allowance for Doubtful
Accounts balances as of 31 December
2017 of PhP4.42 million and PhP0.08
million, respectively, of the PNU-North
Luzon cannot be established due to
absence of clear-cut guideline on the
provision of allowance for impairment
suitable to the entity’s collection and loss
experiences;
 The PNU-North Luzon’s balance of
Accounts Payable Fund Account under
Cash in Bank - Local Currency, Current
Account amounting to PhP2.26 million,
considered as dormant since July 2015,
remained unreverted to the BTr;
 Year-end balances of individual SL
accounts of Due to GSIS amounting to
PhP1.72 million which pertain to current
and prior years’ balances are yet to be
reconciled and are of doubtful validity due
to inaccuracies in recording; and
 Deficiencies were noted on the balances of
Advances to Officers and Employees and
Advances to Special DOs accounts in the
total amount of PhP5.26 million as of
31 December 2017, due to: a) long
outstanding CAs amounting to PhP0.59
million with ages ranging from one to over
three years; and b) dormant unliquidated
CAs amounting to PhP0.11 million which
remain non-moving for 10 years or more.
5. Technological   Net understatement of CIB and Cash-
University of the MDS, Regular account balances by
Philippines PhP7.60 million and PhP11.65 million,
(TUP) System respectively, due to: a) unrecorded tuition
fees/school charges paid thru the bank of
PhP6.25 million; b) double posting of
checks issued and remittance due the BIR
of PhP1.6 million; c) unrecorded interest
income and debit memos of PhP0.12
million and PhP0.57 million, respectively;
d) non-reversal of unreleased checks
e) unrecorded Notice of Cash Allocation
(NCA) of PhP0.96 million; and f) over-
recording of reversal of NCA of PhP10.69
million;
 Overstatement of Accounts Receivable
account by PhP6.25 million due to
unrecorded collections of school/tuition
fees paid thru the bank;
 Doubtful Inventory account balances of
275
PhP48.59 million due to: a) discrepancies
between the Accounting Division and
Supply and Property Office records
amounting to PhP18.47 million; and b)
misclassification of inventory accounts
 Unascertained existence and accuracy of
the recorded PPE due to failure to conduct
a complete physical inventory-taking
supported by duly accomplished RPCPPE
and disparity of PhP11.74 million between
the records of Accounting Division and
Property Office, and non-maintenance by
the Accounting Division of PPELC; and
 Doubtful reliability of AP balance due to
unreconciled discrepancy of PhP2.26
million between the amounts per Schedule
of AP and per GL and erroneous
accounting entries wherein payments to
creditors were charged to AP without
corresponding set-up amounting to
PhP1.76 million thus, understated the
account by the same amount and
overstated the Other Liability account.
6. Polytechnic   PPE accounts with a reported carrying
University of the amount of PhP1.45 billion representing
Philippines 68.89 percent of the total assets were
(PUP) doubtful as to valuation, accuracy and
existence due to, among others, eight
untitled parcels of land acquired thru
donation and being used in its operations
which remained unrecorded in the agency
books; undetermined exact carrying value
of building that was demolished in CY
2010 which is still reflected in the agency
books; continued existence of unaccounted
beginning balances amounting to
PhP419.86 million; and non-submission of
RPCPPE and non-maintenance of the
required substantial PCs, PPELCs and SLs;
 Doubtful validity of CIB-LCCA Account
of PhP512.84 million due to: delayed/non-
submission of monthly Bank
Reconciliation Statements (BRS) that
resulted in unreconciled net variance of
PhP237.62 million between bank and book
balances; dormant PNB bank accounts
amounting to PhP7.15 million that were
transferred/deposited to the PUP Regular
Trust Fund account maintained at LBP
without proper documentation per JEV;
and doubtful existence and ownership of
two dormant bank accounts amounting to
PhP0.48 million;
 Doubtful validity of Inventory accounts
unrecorded Office Supplies Inventory
amounting to PhP3.66 million that
understated the account Office Supplies
Inventory; dormant Inventory accounts
amounting to PhP5.92 million due to non-
existing inventories; existence of
expired/obsolete inventory items in the
stockroom of the Asset Management
276
Office (AMO) and still carried in the
books; improper maintenance of SLCs by
the Accounting Office and SCs by the
AMO, and non-submission and
reconciliation of the prescribed RPCI as at
year-end by the AMO with the records of
the Accounting Unit; and
 Doubtful validity of Accounts Payable
account of PhP105.54 million due to:
inclusion of obligated Contracts/Purchase
Orders (POs) on goods and services not yet
delivered or rendered which overstated the
Accounts Payable account by PhP3.35
million; incurrence of obligations in CY
2017 in the absence of duly approved
contract/POs and conforme by the supplier
that overstated the account by PhP13.28
million; and inclusion of cancelled POs
and liabilities deemed paid amounting to
PhP0.83 million.
7. Philippine State   Doubtful accuracy and completeness of the
College of PPE accounts amounting to PhP326.18
Aeronautics million as of 31 December 2017 due to:
(PhilSCA) a) unrecorded three parcels of land
acquired through donation in CYs 2013,
2014, and 2016; b) the recorded property
in Villamor Air Base amounting to PhP255
million, subject of swap arrangement with
the Bases Conversion Development
Authority, is still not covered by TCT in
the name of PhilSCA; and c) non-
reconciliation and non-maintenance of the
required PC and PPELC.
8. Rizal Technological   Significant limitation on audit works due
University (RTU) to the non-submission within the
prescribed period of 14 February 2018, of
all the components of the financial
statements; this late submission precluded
the Audit Team of RTU to carry out timely
auditing procedures necessary to obtain
adequate assurance regarding the amounts
and disclosures in the financial statements.
The Statements of Financial Position,
Financial Performance and Changes in Net
Assets/Equity were submitted only on
11 April 2018; the Statement of
Comparison of Budget and Actual
Amount, and the Notes to FSs were also
belatedly submitted on 14 June 2018,
while the Statement of Cash Flows
remained unsubmitted; the submitted
Notes to FSs was found inadequate due to
non-presentation of the account
descriptions, incomplete aging and
schedules to support the accounts
presented in the FSs and non-disclosure of
the prior period adjustments/ unrecorded
income and other adjustments; and
significant differences between the
amounts presented in the Statement of
Financial Position and Notes to FSs.
9. Technical Education   The comparative FSs including the
and Skills accompanying Notes to FS for CY 2017
Development was erroneously presented due to non-
277
Authority (TESDA) compliance with Philippine Public Sector
Accounting Standard (PPSAS) No. 3 on
retroactive restatement of Equity
pertaining to prior period adjustments
amounting to a negative amount of
PhP444.32 million;
 Unreconciled amount of PhP30.36 million
in the balance of the account CIB-LCCA
of NCR, and Region II as against per Bank
as of 31 December 2017 and non-
restoration of unreleased and stale checks
in the amount of PhP11.52 million in
NCR, and Regions II, III, V and XI;
 Doubtful Receivable accounts amounting
to PhP23.51 million due to: a) dormant and
unsupported Receivable accounts
amounting to PhP13.49 million in Central
Office, and Regions VI and XI and XII
which were outstanding, inactive and non-
moving for more than five years, which
collectability/and or settlement remain
uncertain, and which could not be
validated in the absence of records/
documents; and b) unliquidated fund
transfers of PhP10.02 million of NCR and
Regions VI to LGUs, NGOs/POs, and
Operating Units;
 Reliability, accuracy and existence of PPE
accounts balances of PhP1.23 billion in
CO, and Regions I, II, III, IV-A, IV-B, V,
VI, XI,XII and XIII as of 31 December
2017 could not be ascertained due to:
a) failure to conduct physical count of PPE
amounting to PhP1.22 billion and absence
of the RPCPPE; b) unreconciled PPE
balance of PhP138.97 million between
Property records and the books of account;
c) inclusion of obsolete/unserviceable
property resulting in net overstatement of
PhP23.15 million in NCR, III, IV-A, V and
XI; d) unrecorded PPE of PhP5.44 million
transferred from the CO to the TESDA
Women's Center; and e) inclusion of semi-
expendable items with a total acquisition
cost of PhP3.88 million in NCR, Regions
II, III, IV-B and VI;
 Validity, existence, and accuracy of the
Inventory account balances of PhP42.62
million in NCR, Regions II, VI and XII as
of 31 December 2017 could not be
ascertained due to: a) unreconciled balance
amounting to PhP0.43 million between
Accounting records in NCR vis-a-vis
inventory report of the Property Officer,
and b) failure to maintain SLs and SC.
Moreover, purchases of Supplies and
Materials and Semi-Expendable items
were directly charged to expense instead of
the Inventory in Regions II and III;
 Unreliable Accounts Payable balance of
PhP587.36 million of TESDA-NCR,
Regions I, IV-A, XI and XIII as of
31 December 2017 due to inclusion of
unsupported, undocumented payables with
278
no valid claimants amounting to PhP70.01
million thereby overstated the payable
account and the related expense/equity
accounts; and
 Doubtful validity of the balance of seven
liability accounts in Region XIII due to:
a) unreverted/undocumented balances in
the accounts Intra-agency Payables, Due to
Officers and Employees and Trust
Liabilities amounting to PhP0.53 million
which had been outstanding for more than
two years, b) unaccounted/unreconciled
balances in Due to NGAS and Due to
LGUs accounts amounting to PhP1.28
million, and c) existence of abnormal debit
balances in the Due Central Office and
Other Payable accounts in the total amount
of PhP0.50 million.
10. Department of   Stale checks amounting to PhP3.07 million
Labor and in Regions II, XIII and NCR were not
Employment adjusted in the books;
(DOLE)  Overstated CIB-FCCA and FCSA by
PhP5.21 million for using the Average
Conversion Rates to the dollar instead of
using the Closing Rates;
 Unrecorded Gain on Foreign Exchange
 Unreliable Due from Non-Government
Organizations/People’s Organizations
account balance due to inclusion of
PhP46.87 million which remained dormant
for over five to 20 years;
 Dormant for more than three to 50 years
the Loans and Other Receivables accounts
 Doubtful balance of Inventory accounts
failure of the Accounting and Property
Office to adopt the Perpetual Inventory
Method;
 Unreliable PPE accounts balances of
PhP1.07 billion due to: a) non-
reconciliation of the difference between
the Accounting and Property records
amounting to PhP410.52 million; b)
the submitted Notes to Financial
Statements and the Lapsing Schedule of
PPE in RO IV-A and misclassified items
as PPE amounting to PhP20.65 million;
c) unrecorded acquisition of PPE in DOLE
CO and RO V in the amounts of PhP3.34
million and PhP6.5 million, respectively,
and unrecorded disposals in the amount of
PhP212.46 million;
 Overstated Other Assets account by
PhP15.01 million due to misclassification
of copyrights and computer software
which should be treated as Intangible
Assets; and
 Unreliable balances of Assets and
Liabilities accounts due to the
accumulation of SLs without details of
279
PhP77.69 million, which were labeled as
“For reconciliation”.
11. National   Understatement of PPE accounts by
Conciliation and PhP1.36 million and consequent
Mediation Board overstatement of Accumulated Surplus/
(NCMB) (Deficit) account and Other Assets account
due to: a) non-recording of one Motor
Vehicle amounting to PhP1.22 million; and
b) non-reclassification of purchased
Library Books amounting to PhP0.13
million with acquisition cost of below
PhP15,000.00; and c) non-reclassification
of unserviceable properties not yet
disposed amounting to PhP0.28 million;
 Understatement of the account Computer
Software, with consequent overstatement
of Semi-expendable – Information and
Communications Technology Equipment
account by PhP0.16 million due to
erroneous recording of purchased
computer software;
 Understatement of Due to BIR account by
PhP0.33 million and overstatement of
Accumulated Surplus/Deficit by the same
amount due to error in the recording of
taxes withheld and remitted as well as the
receipt of NCA for Tax Remittance Advice
(TRA) for the CY 2017;
 Accuracy and existence of the PPE items
amounting to PhP8.87 million as well as
accountability thereof could not be
established due to: a) the absence of
certified RPCPPE; b) non-renewal of
PARs for PPE items issued not
renewed/updated; and c) non-maintenance
of SLs, PPELCs and PCs; and
 Accuracy and existence of Inventory
cannot be established due to: reported
Accounting Records and RPCI; absence of
physical count of inventory amounting to
PhP0.19 million; non-reconciliation
between Accounting and Property records;
and non-maintenance of SLCs, among
others.
12. National Labor   Understated balances of CIB - LCCA and
Relations Trust Liabilities accounts by PhP13.92
Commission million due to non-restoration of stale
(NLRC) checks which remained outstanding in the
books for over seven years while
million were not reverted to Cash account
as at year-end;
 Inaccurate balance of CIB - LCCA
amounting to PhP1.24 billion due to
unadjusted/ unrecorded reconciling items
both per books and per bank of PhP37.28
million, their nature being not determined,
and non-updating of subsidiary records;
 Overstated PPE accounts balances by
PhP1.78 million due to the non-
reclassification of purchased PPE items
with acquisition cost below the threshold
280
of PhP15,000.00 and failure to provide
depreciation for procured motor vehicle;
and
 Inaccurate balance of Trust Liabilities
account amounting to PhP1.38 billion due
to: a) difference of PhP17.11 million
between the Cash in Bank and Trust
Liability accounts; b) incomplete
subsidiary records maintained resulting in
the unreconciled balance of PhP62.99
million between the GL and SL records;
c) difference of PhP54.382 million
between the Trust Liabilities and the
amount appearing in the depository banks'
balances; d) non-monitoring of the status
of prior years' collections/release/
disbursement of both the execution and
fiduciary funds; and e) the non-
reconciliation of the Accounting records
for said trust fund with the Sheriffs’ Report
and Writ of Execution.
13. National Wages and   Overstated balance of account Due from
Productivity National Government Agencies by
Commission PhP0.09 million due to unrecorded
(NWPC) deliveries from DBM-PS;
 Overstated balances of the PPE accounts
by PhP0.25 million due to the failure to
provide depreciation expense during the
year;
 Accuracy and existence of the reported
PPE accounts with carrying amount of
PhP3.56 million cannot be established due
to non-conduct by three Regional
Tripartite Wages and Productivity Boards
(RTWPBs) of physical count and non-
reconciliation between Property and
Accounting records;
 Accuracy and existence of the Inventory
cannot be established due to failure to
conduct physical count, non-reconciliation
of Accounting and Property records and
recorded issuances not supported with
RSMI; and
 Calendar Year (CY) 2016 corresponding
figures presented in the CY 2017 FSs were
not restated to reflect prior year’s errors
and adjustments.
14. National Council for   Misstatement of Advances to Officers and
Children’s Employees account amounting to PhP2.22
Television million due to improper grants of CAs at
(NCCT) the end of the year to cover activities of the
succeeding year when this should have
been reverted back to the BTr as unutilized
NCA for current year 2017;
 Understatement of Due from National
Government Agencies account and
overstatement of Office Supplies Expenses
account amounting to PhP0.01 million due
to non-recording of receivables for
undelivered supplies and outright
recognition of expense upon payment
regardless of actual receipt and delivery;
281
 Misstatement of balances of the PPE
accounts and Accumulated Surplus/
(deficit) amounting to PhP0.06 million due
to improper classification of prior years'
semi-expendable properties; and
 Absence and/or lack of supporting
documents to establish the validity of
various asset accounts amounting to
PhP4.29 million.
15. National Book 
Development Board
(NBDB)
16. Early Childhood   Net overstatement by PhP30.99 million of
Care and Due from GOCCs account balance of
Development PhP387.89 million due to: a.) unrecorded
Council (ECCDC) interest income of PhP0.23 million which
understated the account; and
b.) unrecorded services fees and
deliveries of National Child Development
Center (NCDC) contents to recipient
local government units amounting to
respectively, which overstated the
account;
 Overstatement by PhP0.69 million of PPE
accounts balances amounting to PhP18.09
million due to inclusion of items costing
below the capitalization threshold of
PhP15,000.00 and missing or
unaccounted PPE; and
 Overstatement by PhP2.6 million of
Accounts Payable account balance of
PhP2.62 million due to invalid claims
which were unreverted to Accumulated
Surplus/Deficit.
17. National Museum   Total net overstatement of the Cash in
(NM) Bank - Local Currency, Current Account
by PhP7.56 million due to unrecorded
prior years’ book reconciling items,
unadjusted stale checks, unrecorded
interest income and deposits and book
errors;
 Continued inclusion of dormant
receivables of PhP8.12 million, aged 14
to 40 years, due to failure to initiate
request for write-off and overstatement
by PhP9.56 million of the Due from
National Government Agencies account
due to unrecorded liquidations of fund
transfers;
 Unliquidated CAs of PhP5.01 million
granted to officers and employees
including those granted to deceased
accountable officers amounting to
PhP0.02 million with age ranging from
33 days to 38 years and overstatement of
the Advances for Payroll account by
PhP0.53 million;
 Unreliable balances of PPE accounts due
to non-maintenance of PPE Ledger Cards
by the Accounting Section; unaccounted
items of PPE costing PhP9.38 million;
and erroneous inclusion in the CIP -
282
Buildings and Other Structures account of
the six completed infrastructure projects
amounting to PhP269.72 million thereby
resulting in the overstatement of CIP–
Buildings and Other Structures and
consequently, understatement of other
PPE accounts by the same amount; and
 Unreliable balances of five Liability
accounts due to: a) existence of dormant
accounts payable of PhP8.19 million of
which PhP1.25 million should be reverted
to the Accumulated Surplus/(Deficit) and
unrecognized accounts payables in the
books of PhP19.97 million;
b) overstatement of the Other Payables by
PhP2.2 million and understatement of the
accounts Due to NGAs, Due to LGUs and
Due to GOCCs by PhP1.44 million,
respectively; and c) unreconciled
difference of PhP17.56 million in the
confirmed and reported balances of the
Due to NGAs account.
18. Bureau of Workers   Unreliable balance of Investments
with Special account amounting to PhP162.6 million
Concerns- due to the non-maintenance of subsidiary
Social Amelioration records and other relevant documents to
Program (BWSC- validate their details and accuracy as
SAP) reported in the books;
 Overstated balance of Investments in
Treasury Bills-Local account amounting
to PhP129.19 million due to erroneous
treatment of investment in treasury bills
with less than 91 days maturity instead of
as Cash and Cash Equivalents –Treasury
Bills;
 Doubtful validity of the account
Receivables amounting to PhP16.63
million due to unavailability of
documents to support the unpaid loans
and proof of being still collectible after
remaining dormant for over 20 to over 30
years; and
 Doubtful accuracy of recorded Cash in
Bank balances in three Regions
amounting to PhP8.57 million as no
reconciliation with the depository bank
was undertaken to prove the correctness
of book and bank balances in the absence
of BRSs prepared and submitted.
19. Institute of Labor 
Studies (ILS)
20. Philippine Overseas   Lapses in recording and inaction to
Employment reconcile prior years’ balances of account
Administration Due from NGAs specifically DBM-PS,
(POEA) resulted in a discrepancy of PhP7.58
million between the POEA's Accounting
records and of DBM-PS;
 PPE were not accurately recognized: a) in
accordance with their classification; or
b) as inventories despite not meeting the
threshold of PhP15,000.00; hence,
overstated and understated classes of
PPEs by certain amount each for an
283
aggregate amount of PhP7.46 million and
understated the Inventory accounts by
PhP0.17 million; incomplete inventory-
taking, improper recording of transactions
in the books and non-maintenance of the
required Property Cards, resulted in an
unreconciled balance of PhP321.77
million between the Accounting and
Property records, which cast doubts on
the accuracy, completeness, and existence
of reported PPE accounts with a gross
 Unverified and unreliable book entries,
recording error and absence of physical
inventory-taking affect the reliability,
completeness and existence of the
Inventory accounts amounting to
 Negative balances in the SLs of Accounts
Payable amounting to PhP26.53 million
and setting up of liabilities for
undelivered/uncompleted projects; thus,
adversely affecting the fair presentation
of financial liabilities account reported at
PhP105.78 million.
21. Professional   CY 2017 FSs were not restated to reflect
Regulation prior year errors and adjustments
Commission (PRC) amounting to PhP15.06 million;
 Unrecovered penalties for late
remittances of collections to the National
Treasury (NT) amounting to PhP137.35
million excluding interest by the
Development Bank of the Philippines-
Data Center, Inc. (DBP-DCI) as the
service provider of the PRC on its online
collection system of fees on annual
registration and examination including
surcharges due to the failure of DBP-DCI
to comply with its obligations as agreed
upon in the Memorandum of Agreement
(MOA) and an unauthorized collections
by Dragonpay Corporation of PhP100.70
million, of which, PhP12.12 million
remained undeposited to the NT;
 Accumulation of PhP38.59 million
unliquidated or unsettled CAs due to non-
adherence to provisions of pertinent
regulations on the granting, utilization
and liquidation of CAs, and the absence
of proper monitoring which misstated the
expense and income accounts as of year-
end;
 Unreliable accuracy and existence PPE
accounts balances amounting to
PhP326.32 million due to: a) difference
of PhP113.15 million between the
RPCPPE and the GLs; b) previous years
negative balances of PhP27.82 million
and undetermined forwarded balances of
PhP4.67 million; c) items below the
PhP15,000.00 capitalization threshold
still included in the PPE accounts; d) no
provision for depreciation of some PPE
accounts; and e) understatement of
284
million and Depreciation Expenses of
 AP amounting to PhP50.85 million is
inclusion of payables of PhP13.51 million
which have been outstanding for more
than two years and remained unreverted
to Accumulated Surplus/(Deficit)
account; and erroneous entries amounting
to PhP1.12 million which remained
unadjusted in the books of accounts.
TOTAL 2 17 1 1
Note: Management Letter was issued for Marikina Polytechnic College (MPC), Eulogio "Amang" Rodriguez
Institute of Science and Technology.
Cluster 6 – Health and Science
1. Council for the   The Receivables and PPE of the CWC
Welfare of Children contain misstatements amounting to
(CWC) PhP3.734 million which represent 3.47
percent of the total assets of the Agency
as at 31 December 31, 2017;
2. Inter-Country   Misstatements in the Cash,
Adoption Board Treasury/Agency Deposit (TAD),
(ICAB) Inventory, PPE, Intangible Assets, and
Other Deposits accounts of ICAB contain
misstatements amounting to PhP25.78
million or 75.15 percent of its total assets;
while the Trust Liabilities and
Accumulated Surplus/(Deficit) accounts
were misstated by PhP2.18 million or
14.11 percent of total liabilities and
PhP9.67 million or 51.24 percent of total
net assets/equity, respectively, resulting
in over/understatements of the affected
accounts.
3. National Council on   Misstatements in the Inventories, PPE
Disability Affairs and Other Assets accounts by PhP12.24
(NCDA) million or 35.92 percent of its total assets,
resulting to over/understatements of the
affected accounts.
4. Juvenile Justice and   Misstatements in the CIB-LCCA, Office
Welfare Council Supplies Inventory and Property, Plant
(JJWC) and Equipment accounts by PhP1.748
million or 2.047 percent of the total
assets.
5. Department of   The Cash, Receivables, PPE, and
Information and Intangible Assets accounts of DICT
Communication contain misstatements amounting to
Technology (DICT) PhP3.71 billion which represents 57.67
as at 31 December 2017.
6. Department of   The Cash, Receivables, Inventory, PPE,
Science and and Other Assets accounts of the DOST
Technology contain misstatements amounting to
(DOST) PhP7,377.12 million which represent
70.21 percent of the total assets of the
Agency as at 31 December 2017.
7. Advanced Science   The PPE accounts of ASTI have total
and Technology misstatements amounting to PhP212.36
Institute million which represents 20.62 percent
(ASTI) 31 December 2017.
8. Food and Nutrition   Misstatements amounting to PhP6.98
Research Institute million or 2.54 percent of its total assets.
285
(FNRI)
9. Industrial   The Petty Cash Fund, Due from NGAs,
Technology Semi-expendable Property - Medical,
Development Dental and Laboratory, and PPE accounts
Institute contain misstatements amounting to
(ITDI) PhP134.7 million which represent 16
as at 31 December 2017; while Other
Payables account was misstated by
PhP1.11 million or 0.4 percent of the total
liabilities of the Agency as at
31 December 2017.
10. Metal Industry   The CIBank and PPE accounts contained
Reseach misstatements amounting to PhP177.299
Development Center million which represents 22 percent of the
(MIRDC) Agency’s total assets, while Due to
NGAs accounts have misstatements
representing 36 percent of its total
liabilities as at 31 December 2017.
11. National Academy   Misstatements in the PPE accounts
of Science and amounting to PhP2.49 million or 13.49
Technology (NAST) percent of its total assets of PhP18.48
million as at 31 December 2017.
12. National Research   PPE accounts of NRCP contain
Council of the misstatements amounting to PhP19.92
Philippines million which represents 20.84 percent of
(NRCP) the total assets of PhP95.57 million as at
31 December 2017.
13. Philippine   Misstatements under the assets category
Atmospheric of the Agency amounting to PhP69.49
Geophysical million which represents 1.81 percent of
Astronomical the total assets of the Agency amounting
Services to PhP3,831.32 million as at year-end;
Administration Trust Liabilities of PhP0.36 million was
(PAGASA) misstated rendering its ending balance to
be doubtful.
14. Philippine Council   Due to the significant impact of the
For Health Research misstatements on the reported balances of
and the affected accounts, the management’s
Development assertions as to the occurrence, accuracy
(PCHRD) and completeness of the said accounts
could not be relied upon, as shown in the
table below:
Total
% to
Balance as Amount of
Misstatements Total
Category of
Category
12.31.2018
Assets 675.33 103.85 15.38
Liabilities 43.67 103.85 237.79
Equity 631.66 81.49 12.90

Total 289.19
15. Philippine Council   Misstatements in the Cash - Treasury/

for Industry and Agency Deposit, Trust, Other
Energy Receivables, Due from NGAs, and CIP-
and Emerging Buildings and Other Structures accounts
Research by PhP371.59 million or 14.24 percent of
Development its total assets; while Due to NGAs, Due
(PCIEERD) to BIR and Other Deferred Credits
accounts were misstated by PhP53.54
286
million or 12.38 percent of the total
liabilities of the Agency, resulting in
over/understatements of the affected
accounts.
16. Philippine Institute   The Cash, PPE & Other Assets accounts
of Volcanology and contain misstatements amounting to
Seismology PhP885.84 million which represents 91
(PHIVOLCS) percent of the total assets of PhP975.99
million.
17. Philippine Nuclear   The PPE and Other Current Assets
Research Institute accounts have an aggregate misstatements
(PNRI) amounting to PhP117.87 million which
represents 17.32 percent of its total assets
of PhP680.49 million as at 31 December
2017.
18. Philippine Science   The Receivable, Inventory and PPE
High School System accounts contain misstatements
(PSHSS) amounting to PhP214.61 million which
represents 5.9 percent of its total assets of
PhP3,634.26 million as at 31 December
2017.
19. Philippine Textile   The Receivables, PPE, Deposit on Letters
Reseach Institute of Credit and Other Prepaid Expenses
(PTRI) accounts contain misstatements
amounting to PhP77.08 million which
represent 67.5 percenr of the total assets
of the Agency as at 31 December 2017;
while Due to NGAs account was
misstated by PhP7.02 million or 16.88
percent of the total liabilities of the
Agency as at 31 December 2017.
20. Science Education   Misstatements in the Cash and Liabilities
Institute (SEI) accounts by PhP24.076 million or 0.39
percent of its total assets and PhP60.783
million or 9.35 percent of its total
liabilities, respectively, resulting in over/
understatements of the affected accounts.
21. Science and   The Receivables, Inventories and PPE
Techology accounts contain misstatements
Information Institute amounting to PhP19.43 million which
(STII) represents 17.97 percent of its total assets
2017.
22. Technology   The Receivables and PPE accounts of the
Application Institute have misstatements amounting to
Promotion Institute PhP121.87 million which represents
(TAPI) 22.77 percent of its total assets of
2017; while the reported Revenue
entirely misstated. Due to the significant
impact of such misstatements on the
reported balances of the affected
accounts, the management’s assertions as
to the accuracy, existence, classification,
rights and obligations, and valuation of
the said accounts could not be relied
upon.
23. Commission on   The misstatements of five asset accounts
Population amounting to PhP128.82 million
(POPCOM) representing 54.12 percent of the total
assets of PhP238.02 million and the
erroneous use of expense accounts
287
representing 6.85 percent of the total
expenses of PhP356.48 million affected the
fair presentation of the FSs as at
31 December 2017.
24. National Nutrition   The Cash, Receivables and PPE accounts
Council (NNC) of the Agency contain misstatements
amounting to PhP433 million which
represent 55 percent of the total assets of
2017.
25. NPC   Misstatements in the Due from NGAs,
Office Supplies Inventory, and Semi-
Expendable Property accounts by PhP6.67
million which represented 21.45 percent of
the total assets of the Agency resulting to
over/understatements of the affected
accounts.
26. NTC   Misstatements were found in asset
representing 5.94 percent of its total assets
of PhP3,486.18 million as at 31 December
2017. Due to the significant impact of such
misstatements on the reported balances of
the affected accounts, the accuracy and
completeness of the said accounts could
not be relied upon.
TOTAL 24 2
Note: DSWD and DOH CAARs untransmitted as of 30 June 2018
Cluster 7 - Public Works, Transport and Energy
1. Department of Public   Cash and Cash Equivalents accounts year-
Works and Highways end balance amounting to PhP11.83 billion
(DPWH) was incorrect due to: (a) inclusion of
unsubstantiated cash account balances
aggregating to PhP761.43 million;
(b) unrecorded payments, lapsed cash
allocations and fund transfers, and other
book reconciling items which overstated
the cash accounts by a net amount of
PhP5.96 million; and (c) non-submission
of BRSs;
 Doubtful accuracy and existence of the
Receivables account amounting to
PhP17.177 million due to: (a) dormant
Accounts Receivables and Other
respectively, which are doubtful of
collection but for which no allowance for
impairment was provided; (b) unrecorded
Receivable-Disallowance/Charges of
PhP8.32 million; (c) unliquidated Inter-
Agency Receivables, aged over one year,
amounting to PhP3.999 billion, PhP80.37
million of which pertain to unimplemented
projects; and (d) unreconciled difference of
PhP615.82 million between the DPWH
and IA records;
 Inventory account of PhP1.38 billion as of
31 December 2017 was understated by a
net amount of PhP44.24 million due to:
(a) unrecorded issuances of inventories
288
(b) erroneous recording of inventory
transactions with net amount of PhP15.66
million; and (c) direct recording of
inventory purchases as expense amounting
to PhP37.42 million; and the difference of
PhP100.81 million between the balances in
the GL and RPCI casts doubt on the
existence of the reported inventories;
 Advances to Contractors account of
PhP42.85 billion as at 31 December 2017
was inaccurate due to the erroneous/non-
recording of recoupments which overstated
the account by PhP2.72 million and
inclusion of unsubstantiated balances
 PPE balance of PhP1.58 trillion was
overstated by PhP6.62 billion due to:
(a) unrecorded transfers and disposals of
PPE of PhP434.33 million; (b) unrecorded
delivered PPE and unbilled completed
infrastructure projects costing PhP549.10
million; (c) erroneous classification of
intangible assets, repairs and maintenance
expense, and semi-expendable inventories
amounting to PhP373.14 million as PPE;
(d) failure to derecognize completed
projects costing PhP7.46 billion that are
already in the possession of the recipient
agencies and missing PPE amounting to
PhP40.76 million; (e) erroneous/non-
recognition of depreciation in the amount
of PhP245.18 million; and (f) completed
projects of the MVUC Fund not yet
recorded in the books of DPWH-OSEC
Regular Agency Fund amounting to
PhP1.34 billion; and the non-
reclassification of completed infrastructure
assets costing PhP77.47 billion from CIP
to the appropriate Infrastructure Assets
accounts; failure to recognize impairment
loss for unserviceable properties with
carrying amount of PhP29.29 million;
difference of PhP54.79 billion between
accounting and property records; and
inclusion of undocumented balances in the
total amount of PhP49.49 billion also
rendered the reported PPE balance
unreliable;
 The total reported liabilities as at
31 December 2017 amounting to PhP80.89
billion was overstated by PhP7.96 billion
due to: (a) non-reversion of long
outstanding/dormant payables amounting
to PhP8.42 billion, aged more than two
years, against which no claim has been
filed; (b) unrecorded liabilities for
completed infrastructure projects and
delivered PPE amounting to PhP549.1
million; (c) unrecorded direct payments of
PhP90.83 million to contractors/
consultants by the Foreign Lending
Institution (FLI); and (d) erroneous
recording of inter-agency payables of
PhP2.64 million; the unsubstantiated
289
balances in the AP and Inter-Agency
Payables accounts amounting to
PhP164.36 million cast doubt on the
accuracy of the reported liabilities as at
year-end; and fund transfers received from
various NGAs and GOCCs remained
unliquidated;
 The FSs were not restated to reflect the
effect of prior period errors, change in
accounting policy and other adjustments
amounting to PhP33.46 billion.
2. Road Board   Inter-agency Receivables of PhP1.03
(MVUC) billion remained unliquidated as at
31 December 2017, of which PhP63.09
million or 6.15 percent has been
outstanding for over two (2) years due to
inadequate efforts to enforce prompt
liquidation, thus, the implementation of the
projects for which the fund transfers were
intended was not properly monitored and
the corresponding expenses incurred
against the fund transfers were not
recognized in the year of occurrence;
 PPE account balance of PhP14.58 billion
was overstated by PhP1.3 billion due to:
(a) completed projects aggregating to
PhP1.36 billion still classified under the
CIP accounts and not transferred to the
Regular Agency Fund (RAF) books of
account; (b) capital expenditures of
PhP59.63 million recorded as expense; and
(c) semi-expendable items amounting
PhP0.08 million erroneously recorded as
PPE; and failure to recognize impairment
loss for unserviceable properties with
carrying amount of PhP1.47 million and
the non-recognition of the unbilled portion
of completed projects in the amount of
PhP395.17 million which should be
transferred to the books of the RAF also
rendered the account balances unreliable;
 Guaranty/Security Deposits Payables
account amounting to PhP1.14 billion as at
31 December 2017 was overstated by
PhP1.51 million because liabilities which
had been outstanding for over two years
against which no valid claim has been filed
were not reverted to the unappropriated
surplus of the General Fund; and
 The consolidated FSs were not restated to
reflect the effect of prior period errors and
other adjustments amounting to PhP231.37
million.
3. Metropolitan Manila   Expired computer/system software with an
Development undetermined carrying amount were not
Authority derecognized in the books of accounts;
(MMDA)  PPE reported balance, net of accumulated
depreciation, amounting to PhP4.7 billion
is inaccurate due to: (a) unrecorded PPE
costing at least PhP5.59 billion;
(b) unrecognized completed infrastructure
projects of PhP91.73 million;
(c) expenses erroneously classified as PPE
in the amount of PhP33.64 million;
290
(d) accumulated depreciation exceeding
acquisition costs by PhP9.44 million;
(e) unrecognized depreciation for PPE
costing PhP23.12 million; (f) non-
recognition of impairment loss for
undisposed unserviceable properties with
book value of PhP6.7 million; and
(g) unreconciled difference of PhP1.47
billion between the General Ledger and the
RPCPPE; and deficiencies such as
issuance of service vehicle to non-MMDA
personnel, unreturned diplomat plate, and
land not transferred in the name of MMDA
also posed risks to the proper safeguard of
government assets;
 Long outstanding receivables amounting to
PhP34.01 million representing 94.89
percent of the recorded Due from Officers
and Employees and Other Receivables
accounts remained uncollected for more
than five (5) years yet no allowance for
impairment was provided despite doubtful
collection thereof due to the retirement of
indebted employees, thus, the MMDA’s
assets are carried at more than their
recoverable amount;
 AP account was understated by PhP110.73
million due to the non-recognition of assets
and expenses at the time of completion of
infrastructure projects and delivery and
acceptance of procured goods;
 Dormant accounts amounting to PhP1.14
billion pertaining to different assets and
liabilities of MMDA remained in the books
of accounts due to the absence of relevant
supporting documents thus, the accuracy
and existence of the reported balance could
not be relied upon; and
 The reported payables to Pag-IBIG,
Philhealth and GSIS were understated by
negative balances amounting to PhP40.21
million, 99.20 percent of which have been
in the books of accounts for more than 5
years.
4. Department of   Receivable accounts balances aggregating
Transportation to PhP14.12 billion could not be relied
(DOTr) upon due to non-provision of allowance for
impairment for various receivables
amounting to PhP331.55 million, aged
more than one year to over five years, that
are doubtful of collection; and the failure
to collect the long outstanding receivables
deprived the government of additional
resources to fund its priority projects;
 Inventory account year-end balance
amounting to PhP4.06 billion was
overstated due to: (a) unrecorded
issuances of semi–expendable properties
and office supplies of PhP0.47 million, and
(b) undisposed obsolete card and damaged
inventory costing PhP72.55 million which
were not written down to their fair value;
million between GL and RPCI due to
291
incomplete physical count and non-
maintenance of SLCs and SCs further
rendered the account balance unreliable;
and lapses in inventory management such
as overstocking of Accountable Forms and
Non-accountable Forms and delegation of
control over Pull Tight Taxi Meter Seal
(PTTMS) to a personnel who is not a
designated accountable officer exposed the
government to risk of loss and unnecessary
storage expenses;
 PPE account balance of PhP47.998 billion,
net of Accumulated Depreciation and
Impairment of PhP9.1 billion as at
31 December 2017 was overstated by
PhP574.27 million due to: (a) unrecorded
PPE of PhP113.64 million; (b) burned
building with carrying amount of PhP2.77
million, and transferred infrastructure
assets and PPE of PhP680.91 million not
derecognized from the books;
(c) inadequate recognition of depreciation
in the amount of PhP0.83 million;
(d) recording of undelivered items of
PhP3.9 million; and (e) PPE items
erroneously recorded as expense; and
control gaps in property management such
as incomplete physical count of properties
and unupdated PCs and PPELCs, non-
reclassification of completed projects from
the CIP account to the appropriate
Infrastructure Asset account and non-
recognition of impairment loss for
undisposed unserviceable PPE were also
noted which affect the reliability of the
PPE accounts;
 Inter-Agency Payables year-end balance of
PhP1.59 billion could not be relied upon
due to : (a) recording of the receivables
amounting to PhP215.59 million of the
DOF from various transport cooperatives
in the DOTr books; (b) unadjusted balance
of the Legal Research Fees (LRF) for the
University of the Philippines Law Center
(UPLC) which are already deposited to the
Bureau of Treasury in the amount of
PhP153.15 million; (c) improper offsetting
of the operating lease receivables against
the Due to GOCCs account which resulted
in the non-recognition of the income and
corresponding expense related to the
monthly Developmental Rights Payments
(DRP) due from MRTC/NTDCC; and
(d) unsubstantiated prior years’ balance of
PhP0.49 million.
5. Philippine Coast   CAs granted to PCG officers and
Guard (PCG) employees which are already due and
demandable in the amount of PhP24.36
million or 96.58 percent of the Advances
account balance of PhP25.23 million as at
31 December 2017 remained outstanding
due to the non-submission of adequate
liquidation documents thus, expenses were
not recognized in the period of incurrence;
292
 Unreliable Due from NGAs account
balance of PhP18.26 million due to
between the book balance and the PS-
DBM records caused by the lack of an
effective monitoring scheme to keep track
of the advance payments to and deliveries
from PS-DBM;
 Existence and correctness of PPE accounts
balance in the total amount of PhP7.13
billion could not be relied upon due to:
(a) unrecorded 564 lighthouses and one (1)
unit aluminum work boat; (b) non-
recognition of depreciation for several PPE
costing at least PhP555.31 million and
failure to disclose the effects of the change
in estimated useful life; (c) erroneous
recording of the cost of building in the
amount of PhP0.44 million under the Land
account; and (d) non-reconciliation of
accounting and property records due to the
non-maintenance of PPELC and PC by the
Accounting and Property Section,
respectively, and failure to complete the
physical count of PPE;
 Accounts Payable reported balance of
2017 was overstated by PhP9.78 million
due to: (a) unrecorded payments of
liabilities aggregating to PhP8.72 million,
and (b) non-reversion of payables
amounting to PhP1.06 million, aged over
two (2) years and without valid claims;
 Liquidated damages amounting to
PhP2.120 million was erroneously
recorded as Other Payables instead of
Miscellaneous Income, thus, overstating
the reported liability and understating the
income of the PCG; while FOL Expenses
during the year aggregating to PhP22.02
million were erroneously recorded as
Internet Subscription Expense resulting in
the understatement of the former and
overstatement of the latter expense
accounts; and
effects of the prior period errors and other
adjustments to the beginning balance of the
Accumulated Surplus/(Deficit) amounting
to PhP89.73 million and PhP672.65
million, respectively, nor were the effects
thereof adequately disclosed in the Notes
to FSs.
6. Civil Aeronautics 
Board (CAB)
7. Toll Regulatory 
Board (TRB)
8. Office for   Doubtful accuracy of the reported
Transportation Inventory accounts amounting to PhP2.71
Security (OTS) million as of 31 December 2017 due to
million between the accounting and
property records because the SLCs and
SCs were not updated with correct and
293
complete information on receipts and
issuances of inventories;
 Inaccurate PPE accounts balance of
2017 due to: (a) unrecorded security
screening equipment (SSE) transferred
from the DOTr in the amount of PhP31.4
million and 349 PPE items without
documented acquisition cost found during
the inventory count; (b) failure to
derecognize assets of PhP0.997 million
and recognize impairment losses for
properties in the amount of PhP12.31
million which were lost and damaged,
respectively, during Typhoon Yolanda;
and (c) unaccounted difference of
PhP218.23 million between the book
balance and the RPCPPE;
 The Inter-Agency Receivables account of
PhP76.29 million is overstated by a net
amount of PhP1.96 million as a result of :
(a) erroneous recording of advances
payments to and deliveries from PS-DBM,
and (b) unrecorded deliveries and errors in
recording of service fees and VAT on the
deliveries from Philippine International
Trading Corporation (PITC);
 Other Service Income account balance
understated by PhP29.47 million due to the
(a) unrecorded Aviation Security Fees
(ASF) remittances from CAAP and MIAA
of PhP9.88 million and PhP17.12 million,
respectively and (b) erroneous recording of
ASF remittances from Mactan Cebu
International Airport Authority (MCIAA)
net of service fees of PhP2.48 million.
9. Office of   CAs for special purpose were erroneously
Transportation recorded as Advances to Officers and
Cooperatives (OTC) Employees instead of Advances to SDO,
resulting in the overstatement of the
former account and understatement of the
latter account by PhP2.73 million;
 Unreliable PPE account balances (gross)
(a) the difference of PhP0.407 million
between the General Ledger and the
RPCPPE was not reconciled by the
Accounting and Property Sections in view
of the incorrect PPELCs and the PCs;
(b) semi-expendable items aggregating to
PHP0.15 million were recorded as PPE;
and (c) depreciation expense in the amount
of PhP0.03 million was not recognized.
10. Maritime Industry   Lack of periodic monitoring of ATFs
Authority (MARINA) resulted in unrecorded receivables and
erroneous recording of collections which
understated the Accounts Receivable and
Accumulated Surplus/Deficit by PhP2.3
and overstated the Other Service Income
by PhP6.36 million; non-imposition of
sanction/penalties for unpaid ATFs; and
non-provision of allowance for impairment
294
for uncollectible receivables;
 Fund transfers to PITC and PS-DBM in the
total amount of PhP124.58 million, aged
over one year to more than 10 years,
remained outstanding at year-end due to
non-submission of liquidation reports, non-
refund of excess fund transfers, delayed
implementation of projects, and non-
delivery of procured supplies/equipment;
and the unreconciled difference amounting
to PhP8.48 million between the books of
accounts of MARINA and the
Implementing Agencies (IA) casts doubt
on the accuracy of the reported balance of
the Inter-Agency Receivables of
PhP308.11 million;
 Other Receivables account in the amount
2017 was understated by PhP4.11 million
due to: (a) non/erroneous recording of
audit disallowances in the net amount of
PhP4.04 million; (b) erroneous recording
of settlements in the amount of PhP0.05
million; and (c) negative balances of
PhP0.03 million;
 Errors in recording receipt and issuances of
inventories resulted in a net overstatement
of the Inventory account by PhP3.44
million and the corresponding
overstatement of the Accounts Payable by
PhP0.09 million and understatement of
PPE, Due from NGAs, Office Supplies
Expense and Accumulated Surplus by
PhP0.04 million, PhP0.12 million, PhP3.21
million, and PhP0.02 million, respectively;
between balances in the books and RPCI
of MARINA CO and Region V, and non-
conduct of physical count in Regions VII
and X also rendered the accuracy and
existence of the Inventory balances of
PhP97.37 million as at 31 December 2017
unreliable;
 Unreliable PPE balance as at 31 December
2017 in the total amount of PhP349.17
million due to: (a) errors in recording
resulting in a net overstatement of PhP7.65
million; (b) unreconciled difference of
PhP6.66 million between the books and
RPCPPE due to non-maintenance of
updated property and accounting records;
and (c) incomplete physical count of PPE
amounting to PhP13.56 million in Regions
IV, VII, X, XI; and noted weaknesses in
property management which affected the
proper safeguarding, custody, and
accountability of the agency’s assets.
11. Department of   CIB-LCCA balance of PhP201.52 million
Tourism (DOT) was overstated by PhP67.06 million due to
unrecorded and unidentified bank credits
and debits; and other deficiencies were
noted such as: (a) erroneous recording of
over remittance to foreign creditors that
resulted in the overstatement of Travelling
295
Expense-Foreign account and
understatement of Other Receivables
account by PhP3.86 million; (b) irregular
transfer of cash amounting to PhP0.65
million from Cash – MDS account to CIB-
LCCA account; and (c) unremitted income
to BTr and unreturned excess funds to
Source Agencies aggregating to PhP1.70
million;
 Inventories account reported balance
inaccurate due to: (a) unreconciled balance
of PhP1.13 million between the GL and
RPCI; (b) erroneous recording of
purchases worth PhP1.02 million as
outright expenses; (c) unrecorded
issuances amounting to PhP11.7 million;
(d) erroneous recognition of undelivered
inventories amounting to PhP1.03 million;
and (e) other deficiencies such as non-
conduct of physical count and non-disposal
of obsolete inventory items;
 PPE accounts year-end balances
aggregating to PhP545.82 million were not
reliable due to: (a) difference of PhP14.44
million between the physical inventory and
book balance which could not be
reconciled due to the non-maintenance of
PPELCs and PCs; (b) undisposed
unserviceable PPE amounting to PhP0.38
million with no corresponding recognition
of impairment loss; (c) semi-expendable
properties worth PhP0.4 million still
included as PPE; (d) undocumented and
unrecorded transfer of PPE costing at least
PhP0.08 million; and (e) misclassification
of furniture in the amount of PhP0.02
million as expense and supplies amounting
to PhP0.02 million as PPE;
 Due from NGAs, GOCCs, LGUs, ROs,
and NGOs/POs accounts accumulated to a
total amount of PhP848.264 million, of
which PhP382.51 million has been
unliquidated for over one year, due to
Management’s laxity in enforcing
compliance by the NGAs, GOCCs, LGUs,
ROs and NGOs/POs with the timely
liquidation of fund transfers; thus, the
expenses incurred were not recorded in the
proper accounting period;
 Cash advances amounting to PhP351.6
million representing 74.53 percent of the
reported Advances account balance of
2017 remained unliquidated or unrefunded
despite the completion of the purpose for
which the advances were given resulting in
the non-recognition of expenses in the
period of incurrence;
effects of the prior period errors and other
adjustments amounting to PhP915.19
million.
12. National Parks and   CIB-LCCA balance of PhP7.56 million as
296
Development at 31 December 2017 could not be relied
Committee upon due to unreconciled difference of
(NPDC) PhP1.487 million between the book and
bank balances due to the non-preparation
of monthly BRSs; and collections from the
use of park service amenities, cash bonds,
and bid documents aggregating to PhP0.58
million were not remitted to the BTr;
 Operating Lease Receivable account
balance of PhP26.95 million as at
31 December 2017 was incorrect due to:
(a) unrecorded penalties for late payments
of PhP2.25 million, (b) erroneous
recording of collections of lease
receivables of PhP0.27 million, and
(c) inadequate allowance for impairment
despite the doubtful collectability of the
accounts with aggregated balance of
PhP22.96 million of lessees/
concessionaires which are no longer in
business;
 PPE balance of PhP385.09 million, net of
accumulated depreciation, as at
31 December 2017 was understated by
PhP120.56 million representing the
unrecorded furniture and equipment of
NPDC; and the PPELCs, PCs and
RPCPPE were not updated and/or prepared
in the prescribed format;
 Due to GOCCs account balance amounting
to PhP0.78 million is inaccurate due to its
non-substantiation with supporting
records/documents, while the fund
transfers in the amount of PhP1.26 million
received from the Tourism Infrastructure
and Enterprise Zone Authority (TIEZA)
was erroneously recorded under the Due to
NGAs account; and
effects of the prior period errors amounting
to PhP32.87 million nor were the effects of
the errors adequately disclosed in the
Notes to FSs.
13. Intramuros   Accounts Receivable account balance of
Administration (IA) PhP16.97 million as of 31 December 2017
was understated by PhP0.44 million due to
the non-recognition of unpaid penalties
and surcharges of Kalang Maju Philippines
Corp., former parking concessionaire; and
the IA failed to send demand letters and/or
file appropriate legal charges against erring
concessionaires, resulting in the doubtful
collection of long outstanding receivables
 PPE accounts balance in the amount of
PhP315.12 million, net of accumulated
depreciation, was incorrect due to:
(a) recorded Land account without
supporting documents and non-disclosure
of the fair value of all real properties of IA
as at year-end; (b) failure to reconcile
accounting and property records on PPE;
(c) recorded but undocumented buildings,
structures, and land improvements
297
(d) non-recognition of depreciation for
assets costing PhP12.17 million;
(e) unrecorded donated works of arts and
other PPE; and (f) erroneous recording of
procured equipment and depreciation; and
 Due to NGAs account year-end balance of
PhP30.39 million was understated by
PhP0.18 million due to the recording of
disbursements prior to the receipt of the
fund transfer and recognition of the
liability.
14. Department of  Inter-Agency Receivables and Other
Energy (DOE) Receivables accounts balances aggregating
to PhP1.69 billion as at 31 December
2017 are incorrect due to: (a) accounting
errors and omissions that overstated the
accounts by PhP0.75 million; and (b) an
million between the DOE books and the
project implementer’s records; and fund
transfers aggregating PhP58.64 million,
aged over 10 years, remained unliquidated
because of the absence of explicit
provisions in the MOAs requiring the
prompt liquidation thereof;
 Receivables in the form of training
commitments and developmental
assistance amounting to PhP415.18 million
were not recognized in the books of
accounts, while collected training
commitments in the amount of PhP21.29
million were recorded as liability instead
of revenue resulting in the overstatement
of the Due to NGAs account by PhP21.29
million and the understatement of the
Other Receivables, Income from Grants
and Donations, and Accumulated
Surplus/(Deficit) accounts by PhP415.183
million, respectively;
 Unreliable PPE balance of PhP1.24 billion
as at 31 December 2017 due to:
(a) unrecorded PPEs amounting to
PhP137.80 million; (b) double recording of
equipment amounting to PhP2.06 million;
and (c) unaccounted difference of
PhP125.32 million between the book
balance and the RPCPPE;
 Accounts Payable year-end balance
understated by PhP4.47 million due to:
(a) unrecorded deliveries of various goods
and equipment procured amounting to
PhP29.27 million; (b) double recording of
payables amounting to PhP0.91 million;
(c) erroneous recording of obligations in
the amount of PhP20.52 million as
payables despite absence of actual delivery
of services; and (d) non-reversion of
liabilities amounting to PhP3.37 million,
aged over two years with no valid claims;
 Prior period errors amounting to
PhP199.27 million were not corrected
298
through retrospective restatement, and the
(a) nature of and accounts affected by the
errors, (b) reconciliation of the actual
payments in the Statement of Comparison
of Budget and Actual Amounts (SCBAA)
and the Statement of Cash Flows (SCF),
and (c) reconciliation of cash flows from
operating activities in the SCF and the
Statement of Financial Performance were
not disclosed in the Notes to FSs.
15. Energy Regulatory 
Commission (ERC)
TOTAL 3 11 1
Cluster 8 – Agriculture and Environment

1. Department of  Accounting Errors/Omissions
Agriculture (DA) (in Million PhP)
1. Understated cash
15.77
accounts
2. Overstated Receivable
39.27
accounts
3. Misclassified Receivable
17.22
accounts
4. Overstated Inventory
153.06
accounts
5. Overstated PPE accounts 13.09
6. Semi-expendable items
included in the PPE 21.36
accounts
7. Unrecognized
impairment allowance for 4.95
unserviceable PPE
8. Completed projects not
reclassified from CIP 909.40
accounts to PPE accounts
9. Misclassified PPE
103.75
accounts
10. Unrecorded additional
and losses of breeding 1.88
stocks
11. Misclassified Other
4.45
Assets account
12. Overstated Liability
45.81
accounts
13. Overstated Accumulated
4.16
Surplus/(Deficit)
14. Misclassification
affecting the Expenses 186.40
accounts
Total 1,520.57
Accounting Deficiencies
(in Million PhP)
1) Unreconciled/unsupporte 5,881.26
d and negative balances
2) Unreconciled 595.00
discrepancies in the
balances per confirmation
of receivables
3) Unreconciled differences 9,694.67
of PPE and Inventories
4) Non-provision of 98.89
depreciation
299
5) Dormant/Long 4,477.40
outstanding account
balances
6) Non-reinstatement of CY 9,334.25
2016 Financial
Statements to reflect
prior year errors and
adjustments
Total 30,081.47
2. Department of  Accounting Errors/Omissions
Environment and (in Million PhP)
Natural 1) Unrecorded collections 9.82
Resources (DENR) and book reconciling
items of cash accounts
2) Unrecorded/erroneous 309.69
recording and
misclassification of
receivable accounts
3) Unrecorded acquisitions 175.08
and issuances/ erroneous
recording/non-
derecognition of defective
and expired inventory
items
4) Misclassification/unrecord 422.24
ed/non-recognition and
non-derecognition of PPE
accounts
5) Unrecorded/err 20.15
oneous
classification
of Other Assets
accounts
6) Erroneous 10.69
recording/misclassificatio
n of Liability accounts
Total 947.67
(in Million PhP)
1) Non-maintenance of 26.94
Subsidiary Ledger (SLs)
and schedules/off-setting
of negative balances of
receivable accounts
Inventory
balances/
undocumented
forwarded
beginning
balances
3) Unreconciled 3,195.33
PPE balances/
incomplete
property/ledger
cards
4) Unreconciled SL 323.13
and GL balances
of Other Assets
accounts
5) Absence of 259.73
schedules and
300
documents to
substantiate balances
of Liability accounts
Total 3,930.65
3. Environmental  Accounting Errors/Omissions
Management Bureau (in Million PhP)
(EMB) 1) Non-adjustment to Cash- 1.60
MDS and Due from LGUs
accounts
2) Non-recognition of 5.28
Impairment on Receivable
Accounts
3) Non-adjustment of 0.28
Disallowances on appeal
and have become final and
executory
4) Non-recording/ 20.94
misclassification of PPE
transactions
5) Incorrect recording and/or 1.82
misclassification of various
liability accounts
6) Non-recording of over 0.01
deposit
7) Non-recognition of the 0.01
inventory issued
Total 29.94
(in Million PhP)
1) Discrepancy between 166.31
General Ledger and
RPCPPE
2) Unaccounted amount under 0.34
the account Due to Officers
and Employees
3) Non-restatement of 29.14
Total- 195.79
4. Mines and  Accounting Errors/Omissions

Geoscience Bureau 1) Non-recording of deposits 0.03
(MGB) to Bureau of Treasury
2) Unrecognized receivable 39.24
from mining companies
3) Unrecorded and 2.46
misclassified procured
PPE
4) Non-derecognition of lost 1.41
PPE
5) Non-capitalization of 4.68
major repairs and land
improvements
impairment losses for
unserviceable PPE
7) Incorrect provision of 0.41
depreciation
8) Inappropriate recording of 0.59
prior year’s operating
expense as current
operating expense
301
disallowances which
became final and
executory
Total 49.02
1) Doubtful existence and 3.20
completeness of the
carrying amount of the
Inventory accounts due to
non-reconciliation of the
GL and RPCI
2) Failure to establish the 456.97
existence and completeness
of the PPE accounts
3) Doubtful correctness of 3.15
depreciation costs due to
insufficiency of
information
4) Non-restatement of CY 21.65
2016 Financial Statements
Total 484.97
5. Agricultural Credit  Accounting Errors/Omissions

Policy Council (in Million PhP)
(ACPC) 1) Non-recording of loan 6.32
releases and interest
income earned
2) Impairment loss 10.35
exceeding the book value
of loans receivable
3) Allowance for Impairment 0.55
Loss for unserviceable
property not
provided/recognized
4) Erroneous recording of 2.01
lost/missing equipment
5) Collection of loan 0.14
payments erroneously
credited to Accumulated
Surplus/(Deficit) account
Total 19.37
(in million PhP)
1) Unreconciled Cash in 0.30
Bank-LCCA balance
2) Doubtful collectibility of 1,369.79
past due accounts
discrepancies in the
balances per confirmation
of Loans Receivable
4) Unidentified borrowers of 4.47
Loan payments/collections
5) Unreconciled balance of 72.17
assigned accounts
disclosed in the Notes to
Total 1,598.44
302
6. Philippine Council  Accounting Errors/Omissions
for Agriculture and (in Million PhP)
Fisheries (PCAF) 1) Discrepancy between the 727.48
amount of Prior Period
Adjustments in the Net
Accumulated
Surplus/(Deficit) and
Reconciliation of Net
Cash Flows from
Operating Activities to
Surplus/(Deficit)
Total 727.48
7. National Meat  Accounting Errors/Omissions

Inspection Service (in million PhP)
(NMIS) 1) Unrecorded/unadjusted 4.55
cash transactions
2) Unrecorded/unadjusted 10.99
inventory transactions
3) Misclassification of PPE 1.60
transactions
4) Inclusion of items below 0.27
the threshold of
PhP15,000.00 under PPE
accounts
Total 17.41
(in Million PhP)
1) Perpetual Inventory 6.59
Method not observed
8. National Mapping  Accounting Errors/Omissions

and Resource (in Million PhP)
Information 1) Double recording of 11.07
Authority (NAMRIA) Office Supplies Expense
2) Unrecorded Issuance of 72.44
Inventories
3) Unrecorded and 0.98
misclassified refunds of
DENR Region 8 and 10
4) Unrecorded deliveries of 1.17
PS-DBM
5) Unrecorded cost of 9.52
donated motor vehicles
Total 95.18
(in Million PhP)
1) Perpetual Inventory
Method and Moving
Average Method not used
in recording Inventories
2) Unreconciled difference 245.22
between the PPELC and
RPCPPE
3) Non-maintenance of Non-
updating of SLs
4) Non-restatement of CY 64.92
2016 FS
Total 310.14
303
9. National Water 
Resources Board
(NWRB)
10. Pasig River  Accounting Errors/Omissions
Rehabilitation (in Million PhP)
Commission 1) Non-recording of issuance 0.05
(PRRC) of Inventories
2) Over recording of 0.07
watercrafts
3) Expenses recorded as 0.55
CIP-Infrastructure Assets
Total 0. 67
(in Million PhP)
between the SL/PPELC
and RPCPPE
2) Abnormal negative 3.30
balance of Advances to
Contractors
Total 527.34
11. Philippine Trade 

Training Center
(PTTC)
12. Intellectual Property 
Office of the
Philippines
(IPOPHL)
13. Design Center of the 
Philippines (DCP)
14. Department of Trade  Accounting Errors/Omissions
and Industry (DTI) (in Million PhP)
1) Non-recording of interest 88.23
income earned from the
Barangay Micro-Business
Development Fund
2) Double recording of fund 2.40
transfer
3) Non-reversion of CY 7.90
2016 undocumented
fund transfer
4) Erroneous recording of 21.95
loans receivable.
5) Unrecorded acquisitions 9.29
of PPE
6) Unrecorded 8.24
derecognition of PPE
due to donations and
loss of PPE
7) Shared Service Facilities 21.54
not recorded in
PPELC/GL
8) Shared Service Facilities 2.94
recorded twice in
PPELC/GL
9) Procurement of Office 14.77
Supplies recorded as
outright expenses
10) Cancelled checks in 8.20
prior years incorrectly
recorded as debit to
304
Subsidy from National
Government instead of
Accumulated
Surplus/(Deficit)
11) Unrecorded income and 7.44
remittances from
business name
registration.
Total 192.90
(in Million PhP)
1) Discrepancies in the 0. 24
recorded
income/remittances
between the Philippine
Business
Registration(PBR) and RE
records
between balance per book
and Report on the
Physical Count of
Property, Plant and
Equipment (RPCPPE)
3) CY 2016 figures
presented in the CY 2017
Financial Statements not
restated to reflect prior
year errors/omission and
adjustments
4) Improper disclosures in
the Notes to FS
Total 202.69
15. Board of  Accounting Errors/Omissions
Investments (BOI) (in million PhP)
1) Inappropriate 1.72
reclassification of
unliquidated cash
advances of retired,
separated and resigned
officers/employees to
Other Receivables account
Impairment Loss for
unserviceable property
3) Purchase of Computer 1.00
licenses recorded as
Expense instead of
Computer Software
4) Payables aged two years or 2.03
more remained unreverted
to Accumulated
Surplus/(Deficit)
5) Abnormal SL balances of 1.95
Other Receivables account
Total 18.01
(in Million PhP)
between balance per book
and Report on the
305
Physical Count of
Property, Plant and
Equipment (RPCPPE)
Total 5.94
16. CIAP  Significant limitation in the audit work due to
non-submission of financial statements within
the prescribed period of February 14.
TOTAL 4 11 1
Note: MLs were issued for DAR, BFAR, and Phil FIDA
STATE UNIVERSITIES AND COLLEGES (SUCs) AND STAND-ALONE AGENCIES
CORDILLERA AUTONOMOUS REGION (CAR)
1. Abra State Institute of   Non-submission of several Payrolls and
Sciences and JEVs including supporting documents
Technology (ASIST) amounting to PhP18 million to COA for
audit and custody;
 17 accounts have negative balances
amounting to PhP3.8 million casting doubt
on the validity of these accounts and
reliability of the FSs, in general; and
 Non-preparation or non-maintenance by
the Accountant of GLs and SLs to support
the account balances appearing in the
Institute’s financial reports.
2. Apayao State College   Existence, valuation, and accuracy of the
(ASC) PPE account balances amounting to
PhP40.6 million could not be ascertained
due to the failure of the management to
conduct annual physical count of its
existing PPEs and non-reconciliation of
balances between accounting and property
records.
3. Benguet State   Issued and non-existent Inventories of
University (BSU) PhP21.2 million remained in the books
while Inventory items were not reclassified
from the PPE accounts resulting in
unrecognized expenses of PhP21.2 million
and overstatement of asset and equity
account balances by PhP8.3 million and
PhP29.5 million, respectively ;
 Validity of recognized receivables
amounting to PhP30.5 million was not
established due to lack of transaction
details and supporting documents;
 Inconsistent imposition of surcharges and
penalties on the accounts of lessees
resulting in unrecognized lease receivables
of PhP3.8 million;
 Recognition in the books of Liabilities
amounting to PhP3.7 million with no valid
obligations;
 Obligations for the scholarship programs
included amounts unsupported with
contractual commitments resulting in
doubtful reported Obligations Incurred and
Due and Demandable Obligations of PhP
13.2 million and PhP12.4 million,
respectively; and
 Unobligated cost of the project
“Construction of the CTE Building-Right
Wing” upon perfection of the contract
hence, the appropriations source for the
306
unpaid contract balance of PhP1.6 million
did not remain valid.
4. Ifugao State University 
(IfSU)
5. Kalinga State 
University (KSU)
6. Mountain Province 
State Polytechnic
College (MPSPC)
TOTAL 3 3
REGION I – ILOCOS REGION

1. Don Mariano Marcos   Non-recognition of receipts/collections
Memorial State under Fund 184 as revenue of the Fund but
University as trust liabilities resulting in the
(DMMMSU) accumulation of a huge balance of
PhP93.515 million hence, not reported to
the Board of Regents contrary to CHED
Memorandum Order No. 20-2011, and the
GAM in the accounting of collections thus,
affecting the fairness of presentation of the
accounts in the financial statements.
2. Pangasinan State   Non-reconciliation of PPE account
University (PSU) balances between the inventory reports and
accounting records resulting in a difference
of PhP32.13 million thereby, affecting the
accuracy of said accounts; and
 Dormant/long outstanding investment
amounting to PhP3.75 million was not
supported by a Certificate of Investment or
equivalent official document.
3. University of Northern   Non-recognition of receipts/collections
Philippines(UNP)- under Fund 164 totaling PhP28.66 million
Vigan Ilocos Sur as revenue of the Fund but as Trust
Liabilities.
4. Ilocos Sur Polytechnic   Accuracy of PPE accounts, with a total
State Colleges (ISPSC) balance of PhP205.35 million cannot be
ascertained due to absence of complete and
updated accounting and property records
and non-recording of the value of lots
occupied by the four College campuses.
5. North Luzon 
Philippine State
College (NLPSC)
6. Mariano Marcos State   The existence, validity and correctness of
University (MMSU) the PPE accounts totaling PhP942.21
million could not be ascertained and
reconciled.
TOTAL
REGION II - CAGAYAN VALLEY REGION
1. Batanes State College   Unreliability of PPE accounts totaling to
(BSC) PhP58.52 million due to unreconciled
differences between the accounting records
and the RPCPPE, non-maintenance of PCs
and PPELCs and unverified adjustments
amounting to PhP20.15 million on PPE
accounts;
 Unreverted balance of Cash – MDS to
National Treasury amounting to
 Non-preparation of Monthly BRSs
rendering the balance of Cash in Bank
amounting to PhP12.86 million doubtful.
307
2. Cagayan State   Doubtful balance of CIB-LCCA
University (CSU) amounting to PhP344.62 million due to
non-recording of reconciling items in the
books in some campuses, stale checks, and
non-preparation of Monthly BRSs in other
campuses;
 Dormant and unutilized Bank deposits
amounting to PhP1.52 million unreverted
to the BTr;
 Unliquidated Advances to Officers and
Employees amounting to PhP0.75 million
as of 31 December 2017; and
 Unreliable CIP account amounting to
classification of the completed
infrastructure projects to the proper asset
accounts; ledger balances of the CIP
account, in the books of Andrews
Campus, totaling PhP50.85 million do not
contain the details/composition of the
accounts.
3. Isabela State   Unreliable PPE account, with carrying
University (ISU) value of PhP979.02 million or 71 percent
of the total assets due to: (a) non-
maintenance of complete records by the
Accounting and Supply Offices, difference
of PhP77.41 million between the RPCPPE
and GLs, (b) inclusion of PPEs costing
below the threshold of PhP15,000.00, in
the total amount of PhP6.21 million, and
incomplete subsidiary records for the CIP
Account aggregating to PhP117.40
million; and
 Understated balance of Receivables
account, which is 5 percent of the total
assets, by PhP60.08 million or 93 percent
of reported balance in the amount of
PhP64.51 million in the Consolidated FSs
due to use of cash basis in the recording of
uncollected tuition and other fees from all
ISU Campuses.
4. Nueva Vizcaya State   Unreliable existence and valuation of the
University (NVSU) PPE and Inventories accounts with a
balance of PhP500.23 million and
PhP13.26 million, respectively due to:
(a) unreconciled balances between the
accounting records and property record, (b)
non-reconciliation of CIB-LCCA balances
and actual bank balances amounting to
PhP208.72 million, and (c)
misclassification of the Other Payables
account amounting to PhP5.01 million.
5. Quirino State   Non-reconciliation of the cost balances of
University (QSU) PPE totaling PhP421.31 million with the
RPCPPE;
 Overstatement of CIP by PhP67.94 million
due to Management’s non-reclassification
of completed projects to the corresponding
asset accounts;
 Non-provision of Depreciation Expenses
on related depreciable assets, overstating
the PPE account with net book value of
PhP471.57 million and overstating the net
308
income of the University;
 Non-reconciliation of the discrepancy
the CIB balance and actual bank balances
shown in the Bank Statements;
 Non-reconciliation of the discrepancy
between the inventories account balance
and physical count conducted amounting
to PhP4.36 million in Diffun Campus, and
non-submission of physical count
conducted by Cabarroguis Campus and
Maddela Campus; and
 Overstatement of the biological assets by
PhP1.69 million due to non-compliance
with the prescribed valuation thereof.
TOTAL
REGION III - CENTRAL LUZON
1. Aurora State College   Validity and correctness of the PPE
of Technology account balance of PhP104.64 million as
(ASCoT) of 31 December 2017 could not be fully
relied upon due to lapses noted in the
property management system of the
agency such as incomplete inventory
report, undisposed unserviceable property,
items costing below the capitalization
threshold of PhP15,000.00 still recognized
as PPE, and non-assessment of assets for
provision of impairment contrary to
Philippine Public Sector Accounting
Standard (PPSAS) 21.
2. Bataan Peninsula State   Reliability of the reported balance PPE of
University PhP494.89 million cannot be ascertained
due to non-maintenance of complete/
adequate property records and incomplete
conduct of actual physical count; and
 Correctness of the Due to NGAs account
balance of PhP31.12 million cannot be
established due to the absence of
subsidiary records for the inter-agency
transferred funds, and erroneous
recognition of PhP2.61 million subsidies
from other NGAs in the inter-agency
liability accounts instead of to income
account.
3. Bulacan State   Validity, correctness and existence of the
University (BulSU) PPE accounts with acquisition cost of
PhP1,912.53 million as of year-end were
unreliable due to: (a) difference of
PhP249.57 million between accounting
records and RPCPPE; (b) missing/
unaccounted PPE during actual inventory
(c) incomplete lapsing schedules for PPEs;
and (d) absence of subsidiary records for
all PPE accounts.
4. Bulacan Agricultural 
State College (BASC)
5. Central Luzon State   PPE amounting to PhP44.47 million
University (CLSU) purchased out of Trust Fund remained
unrecognized in the books of accounts;
 Inclusion of PPEs costing below the
threshold of PhP15,000.00 in the total
309
 Unrecorded cost of PhP9.69 million of
breeding stocks under Biological Assets
account; and
 Unrecorded payments of loans payable in
the amount of PhP0.56 million resulting in
the overstatement of Loans Payable -
Domestic under Financial Liability account
and other affected accounts.
6. Nueva Ecija University   Unrecorded receivables from unpaid
of Science and tuition fees of students amounting to
Technology (NEUST) PhP6.15 million resulting in material
understatement of the total Receivable and
Tuition Fees accounts of the University;
 Unreliable PPE account balance of
PhP1,155.82 million due to variance of
PhP8.86 million between the accounting
and property records;
 Unreliable reported Expenses due
unsubmitted vouchers on payments
 Recording disbursements for unpaid
payrolls amounting to PhP0.49 million
resulting in understatement of the Cash
Advance and overstatement of the
Scholarship Expenses accounts.
7. Don Honorio Ventura 
Technological State
University (DHVTSU)
8. Pampanga State   Non-preparation of GLs in prescribed form
Agricultural University and SLs rendering unreliable the account
(PSAU) balances reflected in the financial
statements as of 31 December 2017;
 Unsubmitted DVs, financial reports,
contracts, purchase orders and various
quarterly reports within the prescribed
period preventing the Audit Team from
undertaking a timely and objective review
of the transactions;
 Doubtful reliability, accuracy, existence
and valuation of the PPE account with
carrying value of PhP373.99 million as of
31 December 2017 due to: (a) disparity of
Accounting and Property records; (b)
inadequacy of information in the
Accounting and Property records which
render the identification of PPE items
difficult; (c) failure to provide allowance
for impairment loss; (d) non-derecognition
of disposed unserviceable properties with a
carrying value of PhP0.11 million; and
(e) non-maintenance of the PPELCs and
PCs;
 Accuracy of the cash balance of
2017 was not fully ascertained due to late
submission of the BRSs with all supporting
documents and JEVs;
 Unreliable accuracy, completeness,
existence and valuation of Inventory
accounts with reported balance of
due to: (a) non-conduct of the physical
310
count of inventories; (b) disparity of
PhP11.30 million between the Accounting
and Supply/Property records; and (c)
failure of the Accounting and
Supply/Property Office to maintain the
required SLCs and SCs, respectively.
9. Tarlac State 
University (TSU)
10. Tarlac Agricultural   Unreliable PPE accounts balances as at
University (TAU) year-end amounting to PhP360.74 million
due to: (a) unrecorded PPE items in the
books amounting to PhP13.90 million
thereby understating the PPE account; and
(b) failure to reclassify PPE items below
the capitalization threshold of
PhP15,000.00 with an aggregate
acquisition cost of PhP6.06 million and
net carrying amount of PhP2.20 million
thereby overstating the PPE and
Accumulated Surplus account by PhP6.03
as of year-end.
11. Philippine Merchant   Doubtful PPE account due to: (a) failure to
Marine Academy conduct physical count of PPE resulting in
(PMMA) the disparity of PhP66.54 million between
Accounting and Property records; (b)
assets of PhP241.97 million not
reclassified to proper PPE accounts;
(c) unrecorded donations of at least PhP3.4
million; (d) sold asset of PhP60.13 million
still included in the balances; and
(e) inclusion of assets amounting to
PhP8.84 million with individual values
PhP15,000.00;
 Difference of PhP0.64 million between the
result of the physical count by the Audit
Team and the GL balance of the
inventories; and
 Unsubstantiated Accounts Receivables and
Other Receivables amounting to PhP0.1
million and PhP1.23 million, respectively.
12. Ramon Magsaysay   Doubtful reliability, accuracy, existence
Technological and valuation of the PPE account balances
University (RMTU) of PhP368.09 million as of 31 December
2017 due to: (a) disparity of PhP234.75
million between the physical inventory
report and accounting records; (b) failure
to determine corresponding PPE accounts
affected by adjustment of PhP23.64
million on Construction Materials
Account; (c) non-maintenance of complete
and updated PPELC and PCs; and
(d) unrecorded donated asset.
13. Government Arsenal   Unsupported Land Account carried in the
(GA, DND) books at PhP552.39 million with no valid
proof of ownership counters management’s
assertions on its rights thereon and the
absence of substantive disclosures on the
bases of determining the carrying amounts
as well as the Department of National
Defense (DND) controls and
administration over the said properties;
unupdated assessed value of the properties
311
to its CY 2016 level of PhP1,111.11
million;
 Unreliable Deposit of Letters of Credit
(DLC) balance of PhP1,566.15 million due
to: (a) inclusion of DLCs amounting to
PhP355.27 million that were already
utilized/applied; and (b) dormant balances
amounting to PhP12.46 million have
doubtful commitments hence, the Raw
Materials Inventory for which the above
DLCs were applied unrecognized in the
books resulting in the misstatement of
Inventory and understatement of Payable
account by PhP62.26 million as at year-
end;
 Doubtful reliability and validity of the Due
to NGAs under the Trust Fund with a
balance of PhP551.84 million as of
31 December 2017, due to lack of MOA to
fully support and substantiate the said
payables;
 Unutilized CIB-LCCA of PhP25.409
million, remained unremitted to the BTr,
composed of: (i) unutilized AFP
Modernization Trust Fund of due to
dormancy for unreasonable length of time
and excess funds from procurements of
machinery (ii) balance of deposits from
bid documents of and (iii) unrecognized
and unremitted interest income; and
 Unreliable accuracy and existence of the
balances of Inventory Accounts amounting
to PhP988.34 million due to discrepancy of
Accounting and Property records and
purchases of various construction materials
directly charged to Repairs and
Maintenance Account of PhP11.81 million.
14. Philippine Carabao   Doubtful validity, accuracy and existence
Center (PCC) of the PPE accounts amounting to
PhP1,118.67 million or 58.54 percent of
the total assets of the Agency;
 Unreliable balance of the biological assets
account amounting to PhP182.45 million;
and
 Unreliable balance of Inventory accounts
15. Philippine Center for   Unreliable PPE accounts amounting to
Postharvest PhP198.53 million or 69.36 percent of the
Development and total assets due to the failure of the
Mechanization management to: (a) reconcile the
(Philmech) difference between the RPCPPE and the
Accounting records amounting to
PhP12.03 million; (b) derecognize PhP3.44
million in the books representing various
donated and transferred agricultural and
forestry equipment; and (c) dispose
unserviceable properties carried at PhP0.22
million in the books at year-end.
TOTAL 3 12
REGION IV-A CALABARZON
1. Cavite State   Delayed submission/non-submission of
University (CvSU) consolidated trial balances and FSs/reports
312
hence, the Audit Team was not given
ample time to conduct thorough review
thereof and discrepancies noted in the
review could no longer be communicated
to Management on a timely manner;
 Accuracy of CIB-LCCA reported in the
FSs of the Main Campus as of
31 December 2017 amounting PhP893.83
million cannot be established due to:
(a) non-preparation of BRSs; (b) material
the balances per bank confirmation of 21
bank accounts maintained at the LBP as
against accounting records; (c) difference
of PhP45.75 million between the reported
CIB balances per Statement of Financial
Position (SFP) and Cashier’s Check
Disbursements Records (CkDRs); and (d)
non-maintenance of SLs for cash accounts;
 Failure to accrue and record in the books
of accounts the income from Tuition Fees
for the 1st semester of School Year (SY)
2017-2018 billed to the CHED amounting
to PhP97.48 million and PhP2.09 million,
respectively, for the implementation of
Free Tuition Program of 2017; and
 Unreliable PPE balances at year-end due to
unreconciled difference between the
reported acquisition cost of PPE in the
books (accounting records) against the
RPCPPE (property records) of the Main
Campus which significantly increased by
PhP55.74 million compared to last year’s
discrepancy.
2. Batangas State   Doubtful validity, propriety and existence
University (Bat State of PPE account balance costing
U) PhP1,820.88 million, net of CIP of
PhP502.18 million, due to difference of
PhP17.67 million with the RPCPPE;
 Unreliable year-end balances of Account
Receivables (ARs) of PhP208.71 million,
gross, and Operating Lease Receivable of
PhP1.17 million, gross due to presence of
AR SL negative balances amounting to
PhP150.67 million and improper and
incomplete maintenance of SL of tenants/
concessionaires;
 Doubtful Inventory account balance of
PhP12.13 million due to non-maintenance
of SLCs and failure to adopt the weighted
average method in costing of inventory
assets; and
 Unliquidated CAs amounted to PhP6.33
million as of 31 December 2017 due to
failure of the management to strictly
monitor the grant and utilization of CAs;
additional CAs were granted to
officers/employees with pending
unliquidated balances.
3. Laguna State   Doubtful validity, accuracy and existence
Polytechnic University of the LSPU’s PPE accounts with carrying
(LSPU) amount of PhP798.78 million as of year-
end due to: (a) non-conduct of periodic
reconciliation of PPE records of the
313
Property Office and the Accounting Office
given the non-submission of complete
inventory and reconciliation reports of
LSPU San Pablo and Santa Cruz
Campuses; (b) over provision of
depreciation on one vehicle in Santa Cruz
Campus and on one building and office
equipment in Siniloan Campus;
(c) understatement of carrying amount of
depreciable assets in Santa Cruz and
Siniloan Campuses given the application
of ten percent instead of five percent
salvage value; (d) understatement of
carrying amount of Land account by at
least PhP75.91 million and PhP15.72
million for LSPU Santa Cruz and San
Pablo Campuses, respectively as a result
of non-conduct of revaluation/appraisal of
their real estate properties;
(e) understatement of the Transportation
Equipment and Income accounts by the
estimated appraisal value of the six
vehicles acquired thru donation with no
corresponding cost; and (f) unrecorded
LSPU owned seven buildings with
aggregate acquisition cost of PhP3.30
million under Investment Property in the
Statement of Financial Position, which
general rental income.
 Correctness of the year-end carrying
amounts of PhP14.44 million and PhP6.22
million of the Inventory accounts and
Semi-Expendable Equipment, respectively,
of the LSPU Santa Cruz and Siniloan
Campuses could not be ascertained due to
the failure of the Inventory
Committee/Supply Officer to conduct
physical count of inventory items;
 Unreliable CIB – LCCA of the LSPU
Santa Cruz Campus with a consolidated
balance of PhP125.47 million which did
not reconcile BRSs’ balance of PhP124.36
million, showing a difference of PhP1.11
million as of 31 December 2017; and
 Disclosure requirements in the Notes to
FSs were not fully observed by all LSPU
campuses thus, information contained in
the Notes to FSs did not adequately
provide relevant information on the
accounts presented in FSs.
4. Southern Luzon State   Reliability and accuracy of the accounts
University (SLSU), Investment Property with net book value of
Quezon Province PhP29.68 million and PPE of PhP753.36
million (gross) with a total net book value
of PhP536.76 million representing 50.4
percent of the total assets of the SLSU
could not be ascertained;
 Doubtful accuracy and validity of the
reported balance of CIB-LCCA amounting
to PhP395.09 million doubtful due to:
(a) delayed preparation/ submission of the
BRS and unadjusted reconciling items as
of year-end; and (b) reconciliation of
ledger and cashbook balances for CIB-
314
LCCA not undertaken by the Accounting
Office and the Cashier’s Office at least
every end of the quarter resulting in
million; and
 Cash collected from different school fees
amounting to PhP18.23 million improperly
recorded and deposited under the Income
Generated Project (IGP) account and other
accounts under LBP Account No. 3652-
1000-49; while collections of SLSU-
Tiaong amounting to PhP7.03 million and
various Campuses were not remitted
regularly and intact daily.
5. University of Rizal   Significant audit observations such as
System (URS), accounting errors and deficiencies noted
Morong which affected the fair presentation of
some accounts in the consolidated FSs.
6. Philippine High   Doubtful validity, accuracy and existence
School for the Arts of PPE accounts recorded in the books
(PHSA) with net book value of PhP120.94 million
due to: (a) non-submission of complete
inventory report, resulting in the non-
reconciliation of the Accounting and
Property records for PPE accounts; (b)
inclusion of Machineries and Equipment,
Furniture and Fixtures and Books, with
acquisition cost of PhP15,000.00 and
below, with aggregate amount of PhP9.66
million; and (c) PPE accounts and semi-
expendable items shown in the Inventory
List of the PHSA were not supported with
Acknowledgement Receipt (PAR)/
Inventory Custodian Slip (ICS);
 Correctness of the year-end carrying
amount of PhP3.9 million of the Inventory
accounts could not be ascertained due to
the failure of the Inventory
Committee/Supply Officer to conduct
physical count of inventory items resulting
in the non-reconciliation of the actual
inventory count against the inventory
records of the Supply Unit and Accounting
Office; and
FSs as provided under Section 29, Chapter
2 of the GAM for NGAs, Volume I were
not fully observed by the PHSA.
7. Philippine Council for   Doubtful validity, reliability and existence
Agriculture, Aquatic of the CIB balance of PhP25.97 million as
and Natural Resources of 31 December 2017 due to:
Research and (a) unrecorded book reconciling items
Development resulting in understatement of CIB-LCCA
(PCAARRD) by PhP0.14 million; (b) unreconciled
books of the Accountant and the Cashier
by (PhP148.26) million; (c) presence of
abnormal balances and closed account in
the SL) of CIB-MDS, Regular; and non-
preparation of BRSs for CIB-FCSA;
 Proper disposition was not made by the
Management on CIB-LCTD of
PhP26,168.91 and on CIB-FCSA of
PhP2.02 million dormant for at least five
years;
315
 Total fund releases of PhP1,780.84 million
or 60.65 percent, out of Grants-in-Aid
(GIA) funds released to NGAs, NGOs/POs
and LGUs for the implementation of
Research and Development (R&D)
projects amounting to PhP2,935.94
million, were overdue accounts, of which
PhP1,124.60 million or 63.15 percent are
aged over one year to over three years
due to the failure of Management to
enforce the timely submission of Financial
Reports (FRs). Appropriate sanction was
not initiated against Project Leaders (PLs)
who failed to submit the required FRs.
Moreover, completed projects were not
properly recorded under the accounts
Financial Assistance to NGAs, NGOs/POs
and LGUs of PhP1,658.11 million,
respectively resulting in the overstatement
of Due from NGAs, NGOs/POs and LGUs
by the same amounts, and Accumulated
Surplus(Deficit) by PhP1,780.84 million.
 Correctness of the Due from NGAs
account balance of PhP2,775.84 million at
year-end cannot be ascertained due to:
(a) discrepancy of PhP159.68 million
between the Council’s accounting records
and those of the Implementing Agencies
(IAs), based on the results of
confirmations; and (b) deficiencies in four
SL accounts amounting to PhP10.22
million;
 Unreliable PPE with carrying amount of
is unreliable and misleading due to: (a) the
failure to derecognize from the PPE
account the disposals of equipment
through donation of PhP14.68 million and
equipment damaged by typhoon Rosing of
PhP1.29 million from the PPE;
(b) reclassify semi-expendable items of
PhP3.91 million to the affected accounts;
and failure of the Inventory Committee to
render appropriate RPCPPE;
 Due to NGAs with balance of PhP74.72
million as of 31 December 2017 is
overstated by PhP20.71 million due to:
(a) failure of the Council to record the
liquidation of two Implementing Agencies
(IAs) amounting to PhP4.10 million; and
(b) submit liquidation reports of completed
projects to concerned Funding Agencies
(FA) of PhP16.61 million; and
FSs were not fully observed by the
Council.
8. Forest Products   Doubtful validity, reliability and existence
Research and of PPE account balance of PhP427.19
Development Institute million, net of CIP due to:
(FPRDI) (a) overstatement of PhP6.36 million as a
result of non-recognition of disposed
property and equipment, semi-expendable
items and unserviceable properties
316
amounting to PhP3.39 million, PhP2.07
and (b) partial reconciliation of PPE
accounts resulting in a reporting difference
of PhP99.39 million between accounting
records and the RPCPPE;
 Fully depreciated PPE of PhP4.05 million
were reclassified as Other Assets, of
which a total of PhP3.82 million are still
being used by the Institute in its operations
resulting in the understatement of PPE by
PhP3.82 million at year-end; and
of PhP34.44 million as of 31 December
2017 due to: (a) overstatement of PhP2.85
million as a result of non-liquidation of
completed projects; and (b) inclusion of
account “for reconciliation” amounting to
PhP2.27 million in the SL of Due to
NGAs.
TOTAL 8
REGION IV-B MIMAROPA
1. Marinduque State   Doubtful balances of PPE accounts as of
College (MSC) year-end of PhP167.12 million and
Inventory accounts of PhP1.36 million due
to continued unreconciled Property and
Accounting records resulting in
discrepancy of PhP100.64 million and
 Unsupported balance of Accounts Payable
(A/P) account amounting to PhP113.66
million.
2. Mindoro State   Validity, existence and correctness of PPE
College of accounts balances with net amount of
Agriculture and PhP356.31 million could not be fully
Technology ascertained due to: (a) incomplete conduct
(MinSCAT) of physical count in the Main Campus;
(b) unreconciled difference of PhP39.41
million between Accounting records and
the RPCPPE of Calapan City and
Bongabong Campus; and
 Purchases of supplies and materials during
the year amounting to PhP11.81 million
were directly charged to expense accounts
instead of recording the same to Inventory
accounts rendering the Inventory and
Supplies and Materials Expenses accounts
of PhP4.03 million and PhP8.12 million,
respectively, unreliable and not fairly
stated as of year-end.
3. Occidental Mindoro  • Existence and correctness of the Inventory
State College accounts balances as of year-end
(OMSC) amounting to PhP12.68 million could not
be ascertained due to discrepancy of
records and the RPCI; and
 Doubtful Inventory accounts balances
under the Special Trust Fund-Enhanced
Food for Income Production Program
(EFIPP) amounting to PhP0.43 million due
to non-maintenance of SCs.
4. Palawan State   Validity, existence and correctness of the
University (PSU) PPE accounts balances as of year-end
317
valued at PhP1,103.39 million could not be
ascertained due to non-submission of the
RPCPPE and non-maintenance of the
PPELC and PC;
 Failure to provide depreciation for PPEs
valued at PhP89.01 million; and
 Failure to maintain SLs and Registry of
Revenue and Other Receipts (RRORs) for
fiduciary and non-fiduciary fees collected
in the Main and External campuses,
respectively amounting to PhP319.61
million as of 31 December 2017 resulting
in an incomplete and not detailed
presentation of the Program of Receipts
and Expenditures (PRE).
5. Romblon State   Validity, existence and correctness of the
University (RSU) PPE accounts balances as of year-end with
net book value of PhP221.05 million could
not be fully ascertained due to: (a) non-
conduct of physical count;
(b) unreconciled difference of PhP38.27
million between accounting records and
RPCPPE; (c) inclusion of dormant CIP
account of PhP1.51 million; (d) non-
maintenance of PPELC; and
(e) unrecorded tangible items above the
capitalization threshold of PhP15,000.00
6. Western Philippine   Correctness and reliability of PPE accounts
University (WPU) balances as of year-end valued at
PhP385.69 million could not be
ascertained due to: (a) non-submission of
RPCPPE; (b) unaccounted PPE amounting
to PhP7.40 million; (c) inclusion in the
PPE accounts of tangible items with
amounts below the capitalization threshold
of PhP15,000.00 amounting to PhP21.72
million; and (d) inclusion of unserviceable
properties already reported in the
Inventory and Inspection of Unserviceable
Property (IIRUP) amounting to PhP10.95
million.
7. Palawan Council for  • Validity, existence and correctness of the
Sustainable PPE accounts balances as of year-end
Development Staff valued at PhP24.75 million could not
(PCSDS) be ascertained due to: (a) discrepancy of
records and RPCPPE; (b) inclusion of
semi-expendable items with unit costs
PhP15,000.00 amounting to PhP0.57
million; (c) inclusion of unserviceable
properties already reported in the
Inventory and Inspection Report of
Unserviceable Property (IIRUP)
amounting to PhP1.60 million; (d) non-
maintenance of PPELC and PC; and
(e) unrecorded donated motorcycles to the
Council amounting to PhP7.04 million.
TOTAL 7
REGION V - BICOL REGION
1. Bicol University (BU)   Variance of PhP23.24 million between the
GL and SL balances of the CIB-LCCA
which remained unresolved due to the
318
continuous non-conduct of bank
reconciliation;
 Unadjusted variance of PhP62.89 million
between the balances of the CIP SLs and
the CIPLCs) with the SL higher by the said
amount;
 Unreconciled book balances of various
PPE accounts aggregating to PhP126.11
million with the Property records due to
the absence of complete documents and the
non-conduct of physical inventory count;
 Unreverted various liability accounts,
aging three years and above, in the total
amount of PhP3.63 million with no valid
creditors or claimants;;
 Abnormal debit balances of the Subsidiary
Ledgers pertaining to some liability
which could not be verified due to lack of
documents; and
 Doubtful correctness of the Inventories
Account balance of PhP20.84 million due
to unrecorded inventories consumption of
an undetermined amount and incomplete
physical inventory count.
2. Bicol State College of 
Applied Science and  Doubtful correctness of the recorded
Technology Inventories account due to unreconciled
(BISCAST) overstatement of PhP23.41 million or
97.50 percent of the total Inventories
against the RPCI;
 Propriety of the recorded PPE accounts of
PhP251.24 million, excluding Land,
cannot be ascertained due to the
unresolved overstatement of PhP73.84
million or 31.4 per cent of the total PPE
against the balance per RPCPPE;
 Semi-expendable properties aggregating
PhP17.45 million are still recorded as PPE
and not reclassified as expense upon
issuance to the end-users.
3. Camarines Norte State   Net book value of the PPE account was
College (CNSC) overstated by PhP1.32 million at year-end
due to non-recognition of the impairment
loss on six classrooms and library damaged
by fire.
4. Camarines Sur   Doubtful accuracy and correctness of the
Polytechnic College CIB account balance due to unresolved
(CSPC) prior years’ and unadjusted current year’s
reconciling items amounting to PhP1.29
and
 Unascertained accuracy, reliability and
validity of Other Payables account
representing 52 percent of the balance at
year-end of PhP31.22 million due to
absence of supporting documents and valid
claimants and existence of negative
balances and erroneously recorded prior
years’ transactions amounting to PhP1.25
million and PhP3.77 million, respectively.
319
5. Catanduanes State   Unliquidated cash advances at year-end
University (CSU) amounting to PhP4.39 million thus,
expenses were not properly recognized
during the periods they were incurred
resulting in the overstatement of the asset
and equity accounts; and
 PPE account was over depreciated by
PhP0.41 million due to failure of the
Accountant to consider the 10 percent
residual value of the PPEs which resulted
in the misstatement of the depreciation
expense.
6. Don Emilio B.   Unreconciled difference of PhP11.70
Espinosa Memorial million between the balance per bank and
State College of balance per books due to non-preparation
Agriculture and of the monthly BRSs thus, the correctness
Technology of the CIB alance amounting to PhP61.07
(DEBESMSCAT) million was not assured; and
 Inaccurate and unreliable Biological Assets
million due to improper valuation, non-
recording and non-reporting of agricultural
products.
7. Partido State   Doubtful correctness of PPE account
University (PSU) balance due to unreconciled difference of
PhP4.83 million between the records of the
Accounting and Property Units.
8. Sorsogon State College   PPE account balance at year-end
(SSC) amounting to PhP294.98 million is
understated by PhP16.66 million due to the
non-recording of PPE items worth
PHP17.16 million and recording of
biological assets, semi-expendable
equipment, inventories and repairs and
maintenance expenses amounting to
PhP0.50 million as PPE.
TOTAL 8
Note: ML was issued to Central Bicol State University of Agriculture (CBSUA) due to non-submission of FSs
REGION VI - WESTERN VISAYAS
1. Aklan State University   Doubtful validity of ownership of 31
(ASU) parcels of Land with a total area of
333,204 sq. m. used for school, farm and
fishpond sites of the University and five
parcels of Land owned by the University-
Main and Ibajay Campuses with a total
land area of 78.0308 hectares with an
assessed value of PhP16.34 million due
to absence of pertinent documents and not
covered by a Torrens Title;
 Unrecorded parcel of Land with an area
of 436 sq. m. under TCT No. T-7044
which was not included in the Physical
Inventory of the ASU-CIT as of
31 December 2017 affecting fair
presentation of this account in the FS;
 Doubtful Land account balance of the
ASU-College of Fisheries and Marine
Sciences (ASU-CFMS) due to inclusion
of a lot which was already transferred to
the New Washington Comprehensive
High School (NCWHS);
 Absence of accurate records of
production and sales on products
320
produced by the Food Processing Lab A
and income of RSPC-B of the ASU Main
Campus; and
 Unrecorded Biological Assets of the
ASU-Main and non-inclusion of the same
in the RPCPPE as at 31 December 2017.
2. University of Antique   Doubtful existence and accuracy of PPE
(UA) as at 31 December 2017 amounting to
PhP356.21 million due to non-conduct of
actual physical count of PPE and non-
maintenance of PPELCs and PCs.
3. Capiz State University   Doubtful accuracy of CIB and other
(CPSU) affected accounts due to unadjusted
reconciling items with net amount of
PhP8.41 million in the books as of year-
end;
 Accuracy and existence of year-end
balance of Inventory accounts, including
the Semi-Expendable Property,
be ascertained due to lapses in monitoring
and recording of inventory transactions;
and
 Doubtful Due to NGAs and Trust
Liability accounts year-end balances
amounting to PhP4.7 million and PhP6.6
million, respectively due to absence of
detailed schedules and supporting
documents.
4. West Visayas State   Doubtful accuracy and existence of the
University (WVSU) WVSU – Main, Pototan, Janiuay and
Calinog Campuses’ PPE accounts
amounting to PhP986.82 million as of
31 December 2017 due non-reconciliation
of property and accounting records;
 Overstatement of WVSU-Pototan
Campus’ PPE accounts amounting to
provision of depreciation;
 Doubtful University Medical Center and
Newborn Screening Center-Visayas’
(NSCV’s) PPE accounts amounting to
2017 due to non-reconciliation of
property and accounting records;
 Doubtful Inventory accounts’ balances of
NSCV amounting to PhP95.92 due to
Management's non-conduct of physical
count of inventories and reconciliation of
the balances of the actual assets with the
recorded accountabilities; and
 Unreliable Cash - Collecting Officer
account of WVSU Medical Center
31 December 2017 due to non-
reconciliation of the Accounting Unit of
long noted discrepancy between
subsidiary ledger and cashbook balances
5. Iloilo Science and   Doubtful existence of PPE and
Technology University Inventories accounts amounting to
(ISAT-U) PhP223.61 million and PhP15.24 million,
respectively.
321
6. Guimaras State   Doubtful existence of PPE accounts
College (GSC) amounting to PhP74.53 million;
 Non-reclassification of semi-expendable
million;
 Erroneous charging of accounts
 Unsubmitted financial documents
7. Iloilo State College of   Inventory of 54 ICT equipment and
Fisheries (ISCOF) computer software amounting to PhP4.22
million acquired for the Full Mission
Bridge Simulator of ISCOF Main (Tiwi)
Campus were found to be deficient and
substandard but were accepted and paid
by the College despite non-conformity
with the specifications;
 Grant of one-year study leave to the
College Accountant of ISCOF Main
(TIWI) Campus did not adhere with the
CSC Memorandum Circular No. 21,
Series of 2004 on the Limitations for
Study Leave,
 Unauthorized and unrecorded collection
of thesis fees, which was over and above
the amount approved by the Board of
Trustees contrary to Section 4.d of RA
No. 8292 and non-issuance of official
receipts contrary to Section 68 of P.D.
No. 1445 thus, understating the total
income from trust fund;
 Doubtful existence, accuracy and
valuation of PPE due to failure of ISCOF
Main (Tiwi) and Dumangas Campuses to
complete the conduct of inventory of all
the College’s PPE amounting to
2017 and to undertake the required
reconciliation of Accounting and Supply
records; and
 Doubtful accuracy and existence of the
Inventory accounts as of 31 December
2017 amounting to PhP3.91 million due
to non-conduct of physical inventory and
failure to prepare the SLCs, SCs, and
RPCI.
8. Northern Iloilo   Unreliable year-end PPE account
Polytechnic State balances due to non-preparation of CY
College (NIPSC) 2017 RPCPPE for properties amounting
to PhP455.74 million, unreconciled
balances between the Accounting and
Property records amounting to PhP3.48
million, and deficiencies in the accounts’
control mechanisms;
 Tampered/doubtful corrections of Official
receipts and financial records which
rendered difficult the reconciliation of the
collection report with the amount of cash
balance;
 Undelivered equipment as of
31 December 2017 amounting to PhP0.16
million was recorded in the books of the
Main Campus;
322
 Long outstanding, undocumented and
dormant Other Receivables amounting to
PhP0.91 million remained in the books;
 Doubtful Inventory accounts’ balances of
Sara Campus amounting to PhP1.83
million due to non-conduct of physical
count of inventories and non-preparation
of the CY 2017 RPCI; and
 Unaccounted accountable forms and
receipts and issuances not properly
monitored resulting in non-preparation of
Reports of Accountability for
Accountable Forms (RAAF) and non-
submission of the same to the Office of
the Auditor.
TOTAL 8
REGION VII – CENTRAL VISAYAS
1. Cebu Normal   Material misstatement of Due From
University (CNU) National Government and AP accounts as
of 31 December 2018 due to erroneous
recording of the untransferred fund balance
for the implementation/construction of the
CNU Academic Center for Arts and
Sciences Building amounting to P34.56
million;
 Unreliable AP balance of PhP77.94 million
as of 31 December 2017 due to incorrect
balances, as confirmed by 20 creditors in
the total amount of PhP40.95 million or
52.54 percent of the reported Accounts
Payable balance. Moreover, confirmation
of one payable account amounting PhP0.53
million was reported by the creditor as a
cancelled transaction due to funding source
constraints;
 Other audit observations raised in previous
audit reports have not been resolved as at
31 December 2017, as follows:
(1) Unreliable Cash in Bank and Other
Deferred Credits accounts balances
due to recording of reconciling
items/adjusments appearing in the
monthly bank reconciliation
statements of CY 2017 amounting to
PhP4.13 million, consisting of current
and prior years' erroneous/unrecorded
transactions and stale checks without
identification and supporting
documents;
(2) Valuation of the Multi-Purpose
Building II (CTE), a component of
the School Buildings account, still
differed by PhP33.21 million between
the accounting records and RPCPPE
as of 31 December 2017;
(3) Other Payables account, with a
balance of PhP20.79 million, still
unsupported with SLs, a constraint in
applying alternative audit procedures
to validate the said balance;
(4) Several abnormal account balances
amounting to PhP14.70 million are
still carried in the books of the
University casting doubts on the
323
reliability of the affected account
balances; and
(5) Unreliable Inventory account balance
of PhP13.24 million due to difference
with the results of the physical count
by PhP1.9 million.
2. Cebu Technological   Unreliable PPE account balance
University (CTU) aggregating to PhP1.08 billion as at
31 December 2017 cannot be relied upon
due to: (a) non-recording of the donated
projects implemented by the Graduate
School students through its Participative
Research of CTU Main Campus;
(b) absence of physical count and non-
maintenance of PPELCs by the
Accounting Office and PCs by the Supply
Officers; (c) inclusion of items that did not
meet the capitalization threshold in the
PPE account; and (d) error in recording of
depreciation;
 Overstatement of the accounts CIP and AP
at PhP15 million each for the two
Campuses as at 31 December 2017 due to
erroneous recording of the total fund
allocation for the Construction of Research
Development and Engineering Building of
CTU-Danao Campus, and for the
Construction of Two (2) Storey Research
and Technology Builidng (Phase 1) of
CTU- Moalboal Campus without progress
billing from the contractors corresponding
to the actual accomplishment of the
projects;
 Doubtful accuracy and reliability of Other
Payables account of BISU Main Campus
31 December 2017 due to: a) incorrect
recording of disbursements, collection of
income and loan repayments; and
b) absence of detailed composition for
each category;
aggregating to PhP12.58 million of BISU
Main Campus due to non-submission of
the required RSMI to support the issuances
of inventories made in prior years;
audit report which remained unresolved as
at 31 December 2017:
(1) Doubtful existence and accuracy PPE
account balances of BISU Bilar,
Calape, Candijay, Clarin and Main
Campuses aggregating to PhP485.907
million (net of accumulated
depreciation) as of 31 December 2017
due to uncompleted physical count of
properties and non-reconciliation of
the records kept by the Accounting
Unit and the Supply Office in BISU
Main Campus;
(2) Scholarship grants amounting to
PhP32.09 million under the Expanded
Students’ Grants-in-Aid Program for
Poverty Alleviation (ESGP-PA) and
324
Tulong Dunong (TD) Scholarship
Program for FY 2017 still recorded as
Scholarship Expense in the books of
the Main Campus upon transfer of the
funds to its Special Trust Fund and
other external campuses thus,
overstating the Scholarship Expense
account; and
(3) Doubtful accuracy and reliability of
Accounts and Other Payables
accounts in BISU-Candijay Campus
amounting PhP10.97 million as of
reconciliation of SL balances against
the GL and non-submission of
supporting schedule to support the
validity of the accounts.
3. Bohol Island State   Doubtful accuracy and reliability of Other
University (BISU) Payables account of BISU Main Campus
31 December 2017 due to: a) incorrect
recording of disbursements, collection of
income and loan repayments; and
b) absence of detailed composition for
each category;
aggregating to PhP12.58 million of BISU
Main Campus due to non-submission of
the required RSMI to support the issuances
of inventories made in prior years;
audit report which remained unresolved as
at 31 December 2017:
(1) Doubtful existence and accuracy PPE
account balances of BISU Bilar,
Calape, Candijay, Clarin and Main
Campuses aggregating to PhP485.91
million (net of accumulated
depreciation) as of 31 December 2017
due to uncompleted physical count of
properties and non-reconciliation of
the records kept by the Accounting
Unit and the Supply Office in BISU
Main Campus;
(2) Scholarship grants amounting to
PhP32.09 million under the ESGP-
PA and TD Scholarship Program for
FY 2017 still recorded as Scholarship
Expense in the books of the Main
Campus upon transfer of the funds to
its Special Trust Fund and other
external campuses thus, overstating
the Scholarship Expense account; and
(3) Doubtful accuracy and reliability of
Accounts and Other Payables
accounts in BISU-Candijay Campus
amounting PhP10.974 million as of
reconciliation of SL balances against
the GL and non-submission of
supporting schedule to support the
validity of the accounts.
4. Siquijor State College   The land account balance of PhP 1.21
(SSC) million with a total land area of 35,421
325
square meters is not fairly valued because
said valuation was based on an unreliable
measurement affecting the fair presentation
of the PPE account as presented in the
Statement of Financial Position as at
31 December 2017;
 Stale checks amounting to PhP0.33 million
remained unadjusted in the books of
accounts resulting in the understatement of
the CIB and AP accounts by the same
amount as of 31 December 2017;
audit reports have not been resolved as at
31 December 2017:
(1) Unreliable PPE account balance of
PhP138.91 million at year-end due to
the variance between the balances
appearing in the GL and in the
Inventory of School Properties (ISP)
amounting to PhP41.784 million still
unresolved; and
(2) Semi-Expendable Properties
amounting to PhP0.17 million but
costing below PhP15,000.00 each
were still recorded in CY 2017 under
the PPE accounts misstating both
accounts with a corresponding
overstatement in the Accumulated
Depreciation/Depreciation Expense
for the year.
TOTAL 4
REGION VIII - EASTERN VISAYAS
1. Easter Visayas State   Unreliable year-end total balances of the
University (EVSU) Cash and Cash Equivalents of PhP726.94
million and Net Assets/Equity of
PhP1,711.21 million as reported in the
Statement of Financial Position as of
31 December 2017 due to the following: a)
prior years’ balance of the CIB-LCCA
(DBP) under FC 01 of the Main Campus
amounting to PhP308.81 million were not
supported with subsidiary records/details;
b) existence of year-end balances of the
Cash-Treasury/Agency Deposit, Regular;
Cash-MDS, Regular; and Cash-Tax
Remittance Advice, amounting to
PhP77.28 million, which by nature, should
have no balances reflected as of year-end;
c) overstatement of the reported Surplus
for Calendar Year 2017; and d) inclusion
of Government Equity-Held in Trust
account, an account not found in the
Revised Chart of Accounts, with a balance
PhP87.79 million, that is not supported
with a subsidiary ledger/details;
 Unreliable year-end Accounts Receivable
balance of PhP31.75 million due to the
following: a) unbooked assessed tuition
and other school fees for the 2 nd Semester
of Academic Year 2017-2018 resulting in
understated balance; b) non-maintenance
of SLs for prior years’ balances of
Accounts Receivable; c) existence of
abnormal beginning balances amounting to
326
PhP43.38 million pertaining to the
Tanauan Campus account; and
d) recording of the bulk of receivables
under the Regular Agency Fund instead of
under the Internally Generated Fund;
 Unreliable year-end PPE accounts balance
of PhP1,331.45 million due to the
following: a) discrepancy in balances
between the financial statements and
submitted RPCPPE, b) non-maintenance of
PPELCs and failure to update PCs, and
c) failure to conduct a complete annual
inventory of the Property, Plant and
Equipment by the Main, Tanauan, and
Burauen Campuses;
 Unreliable year-end balances of the
Advances for Operating Expenses,
Advances for Payroll, Advances to Special
Disbursing Officers, and Advances to
Officers and Employees accounts,
discrepancy in balances between the GL,
SLs, and the Aging Report of Unliquidated
CAs as at 31 December 2017;
 Unreliable year-end balances of the Due to
BIR, Due to GSIS and Due to Pag-IBIG
accounts due to the following:
a) discrepancy of PhP0.34 million in
recorded remittances to the Due to BIR
account and to the Cash-Tax Remittance
Advice account under FC 01; b) existence
of abnormal beginning and ending
balances of the accounts; and c) non-
maintenance of subsidiary records for all
campuses;
of PhP69.17 million due to the following:
a) presence of abnormal beginning
balances of the account from prior years’
transactions; b) non-maintenance of
subsidiary records to support receipts and
disbursements; and c) recording of fund
transfers from other NGAs in three fund
clusters, instead of FC 07 only;
 Uncorrected/unadjusted year-end negative
balance of the Other Deferred Credits
account of PhP3.66 million since CY
2016; and
 Unreliable year-end balance of the Other
Payables account amounting to PhP86.83
million due to: a) existence of negative
balances in three fund clusters that reduced
the account balance by PhP12.60 million;
b) existence of a PhP98.55 million balance
under FC-01 that has no cash back-up; and
c) failure to maintain SLs for each FC by
the external campuses.
2. Leyte Normal   Unreliable year-end balances of the
University (LNU) following accounts:
1. Inventory Held for Consumption
amounting to PhP14.18 million due to the
following: a) non-existence of inventories
in stock corresponding to the year-end
balance; b) non-maintenance of SLCs
327
and SCs by the Accounting and the
Supply Offices; c) failure to regularly
conduct the physical count of inventories
to substantiate the accuracy of the
reported balance; d) non-preparation and
submission of the RPCI; and e) non-
disclosure in the Notes to FSs of the
relevant information on the combined
account balance;
2. PPE account amounting to PhP559.48
million due to the following: a) non-
maintenance of PPELCs by the
Accounting Office; b) non-reconciliation
of accounting and property records
resulting in discrepancies in balance
between the year-end FSs and the
RPCPPE; and c) failure to conduct a
complete periodic inventory of all PPE of
LNU; and
3. Undocumented liabilities in the aggregate
amount PhP127.72 million which
comprised 57 percent of the year-end AP
balance of PhP48.21 million;
 Understatement of the School Fees income
account in FC-05 by PhP11.71 million;
and overstatement of the Other Service
Income account in FC-05 and Other
Payables account in FC-07 by PhP1.14
respectively, due to the use of
inappropriate account and accounting
books in booking up the school fees
collected.
4. Palompon Institute of   Unreliable year-end balances of the CIB-
Technology (PIT) LCCA and the CIB-LCSA amounting to
respectively, due to unreconciled variances
between the balances of bank and book;
 Allowance for Impairment Losses was not
provided for Accounts Receivables
amounting PhP1.63 million under Fund
Cluster (FC)-06;
 Unreliable year-end balance of Accounts
million under FC-05 in view of the total
negative variance of PhP1.15 million with
the Schedule of Account Receivables as of
year-end;
 Understatement of the year-end balance of
the Other Receivables-Due from Officers
and Employees amounting to PhP1.07
million due to failure of the Accountant to
record the receivables from two other
school officials who reneged/defaulted
their scholarship contracts;
 Unreliable year-end balance of the PPE
in view of the discrepancies between the
accounting records and the submitted
RPCPPE; absence of details on the prior
years’ forwarded balance for School
Building costing PhP8.83 million; failure
to derecognize donated School Building
valued at PhP7.97 million; incomplete
328
conduct of physical inventory count by
both campuses; and non-maintenance of
PCs by the Tabango Campus;
Payables account of PhP0.99 million due
to non-maintenance of SLs for all
transactions related to the account; and
 Disbursements pertaining to CY 2016
transactions of FC-01 and FC-05
charged to appropriations allotted for
operating expenditures covering the period
CY 2017.
5. National Maritime   Unreliable year-end balance of the
Polytechnic (NMP) Inventory account amounting to PhP12.57
million due to non-preparation RPCI for
Semi-Expendable Items valued at PhP1.32
million, discrepancy in balances between
the financial statements and submitted
RPCI amounting to PhP8.24 million and
overstatement of the balance by PhP0.46
million due to erroneous recording of
acquisitions to Inventory accounts;
account of PhP969 million due to non-
preparation of the RPCPPE valued at
PhP701.74 million; discrepancy in
balances between the financial statements
and submitted RCPPEs; non-maintenance
of PCs for some PPE items; existence of a
PPE balance of PhP41.51 million marked
for reconciliation and without supporting
details; and net overstatement by
PhP98,384.06 due to erroneous recording
to Repairs and Maintenance Expense
account of procured PPE items amounting
to PhP366,424.94 and non-reclassification
to semi-expendable property of some
tangible items costing below PhP15,000.00
amounting to PhP464,809.00;
 Inaccurate recording of collections from
sale of bidding documents amounting to
PhP320,000.00 to the accounts Other
Service Income and Other Gains instead of
the Miscellaneous Income account; and
 Failure to ascertain the correctness of the
recorded transactions totaling PhP1.07
million due to non-submission of the DVs
and supporting documents for audit.
6. Naval State University   Unreliable CIB-LCA balance of
(NSU) PhP21.995 million as of 31 December
2017 due to non-maintenance of SL for FC
07 and FC 06 of the Main Campus, and
inclusion of erroneous data/balances in the
monthly BRSs;
 Unreliable Accounts Receivable balance of
due to the following: a) unrecorded School
Fees which understated the Accounts
Receivable balance by PhP39.05 million;
b) cash collections from assessed school
fees amounting PhP22.64 million were not
recognized as Accounts Receivable at the
time of assessments, and c) discrepancy in
329
balances between the GL and the Schedule
of Accounts Receivable under FC 05;
account at gross cost of PhP287.85 million
as of 31 December 2017 due to the
between the FSs and submitted RPCPPE;
b) incomplete/ inadequate information in
the RPCPPE rendering it difficult to
reconcile with property records, c) non-
conduct of reconciliation between property
records maintained by the Accounting and
Supply Offices; and d) inclusion of
unserviceable properties valued at PhP0.37
million of the Biliran Campus; and
 Unreliable year-end balance of the CIP-
Building and Other Structures account
non-maintenance of CIPLC for all on-
going infrastructure projects and inclusion
of costs of minor repairs of various
facilities, as well as costs of completed
infrastructure projects amounting PhP8
million, all of the Biliran Campus.
7. Visayas State   Unreliable year-end balance of the CIB-
University (VSU) LCCA of PhP509.91 million due to the
failure to adjust/correct the following:
a) discrepancy in balances between the GL
and Bank Confirmation Results; and
between the Main Campus and external
Campuses records amounting to PhP22.17
million; b) unadjusted reconciling items in
BRS treated as additions and deductions
PhP2.81 million, respectively; and c) non-
reversion to CIB-LCCA of CY 2017
million;
 Unreliable year-end Accounts Receivable
balance of PhP72.96 million due to
misclassification of accounts amounting to
PhP0.99 million; and discrepancy in
balances between accounting records and
nine confirmation replies from debtors
 Allowance for Impairment Loss was not
provided for the Other Receivables
account balance of PhP19.57 million with
ages ranging from over one year to over 10
years;
 Unreliable PPE account balance of
PhP999.61 million due to the following: a)
non-maintenance of PPELCs and PCs;
b) discrepancy in balances between the GL
and CY 2017 RPCPPE of the Main
Campus; c) non-conduct of inventory of all
the PPE items of the Isabel Campus; d)
erroneous recognition as PPE of on-
going infrastructure projects amounting to
PhP8.93 million; e) non-recording of assets
received through donation; f) non-
reclassification to semi-expendable
property of tangible items costing below
PhP15,000.00 amounting to PhP0.42
330
million; and g) non-provision of
depreciation on some PPE items;
 Unreliable year-end balance of the
Advances to Officers and Employees
account for external campuses of PhP0.33
million due to non-maintenance of SLs for
each AO and for each FC, and discrepancy
in balances between the GL of the Main
Campus and SLs of the Alang Alang,
Isabel and Tolosa Campuses;
 Understatement of the Due to BIR account
by PhP5.56 million due to erroneous
recording of monthly tax remittances;
 Unreliable year-end balance of the Due to
NGAs account of PhP141.36 million as of
31 December 2017 due to the following:
a) erroneous recording by VSU Alang
Alang Campus of fund transfer from
CHED amounting to PhP4 million; and
b) discrepancy in balances , between
Source Agency (SA) and VSU records
amounting to PhP43.02 million; between
the SLs and financial reports; and previous
years’ savings brought forward in the
succeeding years’ financial/ liquidation
reports, for DOST Phi-LiDAR I and II
projects; and
to misclassification of accounts amounting
to PhP8.65 million and abnormal/negative
balances amounting to PhP11.47 million.
8. Southern Leyte State   Unreliable year-end balance of the CIB-
University (SLSU) LCCA of PhP123.53 million due to the
following: a) net unreconciled difference
balances of the GL and SLs; b) variance
in balances between CIB accounts (all
funds) and of the bank confirmation
results; and c) unrecorded stale checks and
reconciling items amounting to PhP0.17
million;
accounts with book value of PhP603.08
million due to the following: a) failure to
update and/or non-maintenance of PPELCs
and PCs for some PPE items and
discrepancy in balances of PhP359.73
million between the financial statements
and submitted RPCPPEs; and b) failure to
dispose and drop from the books
unserviceable PPE items valued at PhP5.38
million; and
recorded transactions amounting to
PhP11.07 million due to non-submission of
the DVs and supporting documents for
audit.
9. Northwest Samar State   Unreliable year-end balance of the CIB-
University (NwSSU) LCCA of PhP145.61 million due to
discrepancy in books and bank balances
amounting to PhP1.62 million caused by
the failure to update BRSs and failure to
record various reconciling items
331
provided for Accounts Receivables;
 Unreliable balance of the Inventories
accounts due to the non-preparation/
submission the RPCI by both campuses
and failure to maintain complete and
updated SLCs and SCs;
account balances amounting to PhP182.23
million due to the following: a) non-
maintenance and/or failure to update PCs
and PPELCs for some PPE items; b)
discrepancy in balances between the San
Jorge Campus’ GL and RPCPPE,
c) overstatement of the PPE account
balance by PhP0.56 million due to the
booking-up of undelivered equipment
costing PhP0.43 million and of items
amounting to PhP0.13 million which did
not meet the capitalization threshold of
PhP15,000.00;
 Overstatement of the balance of School
Buildings and CIP-Building and Other
Structures accounts by PhP0.45 million
and PhP0.75 million, respectively due to
erroneous recognition as an asset of the
honoraria granted to the members of the
Infrastructure Project Management
Committee (IPMC) amounting to PhP1.2
million; and
 Variance of PhP25.67 million in the total
Surplus from current operations as
reported in the Statement of Changes in
Net Assets/Equity (SCNAE) and Statement
of Financial Performance.
10. Samar State   Unreliable year-end balances of the
University (SSU) following accounts:
1. Cash in Bank-Local Currency, Current
Account balance of PhP117.91 million
due to various discrepancies in
balances between bank and book
records caused by the failure to record
various reconciling items amounting to
PhP0.55 million and the absence of
complete and properly accomplished
GL and SLs;
2. Accounts Receivable amounting to
PhP30.51 million due to the following:
a) recording of income from school
fees on cash basis, b) unreconciled
variance of PhP28.91 million between
the amounts reflected in the Statement
of Financial Performance and
Statement of Cash Flows, and
c) absence of Schedule of Accounts
Receivable and subsidiary records;
3. PPE accounts balances amounting to
2017 due to the following:
a) discrepancy in balances between the
Individual Financial Statements and the
RPCPPE, b) Semi-expendable
332
million were not reclassified to the
proper inventory account,
c) overstatement of the School
Buildings account balance by
PhP19.87 million and CIP-Other
Buildings and Structures account by
PhP1.63 million due to erroneous
recording of transactions, and d) non-
depreciation of some PPE items valued
at PhP1.58 million; and
4. AP amounting to PhP46.83 million was
not supported with sufficient evidence;
 Understatement of the Due to Pag-IBIG
account balance by PhP0.43 million due to
outright recording of deposits to eGOV
savings account as remittances; and
audit.
11. Eastern Samar State   Unreliable year-end balance of the CIB-
University (ESSU) LCCA of PhP80.47 million due to the
between the CIB-LCCA (all funds) and
Bank Confirmation Results; b) unrecorded
valid reconciling items amounting to
PhP0.51 million resulting in
understatement of the CIB Balance; and c)
various reconciling items in the BRSs,
both in ESSU and bank records, without
supporting details and/or supporting
documents;
 Unreliable year-end balance of the
Accounts Receivable of PhP53.16 million
due to the following: a) unrecorded
receivables for assessed school fees
b) unassessed school fees of 100 confirmed
enrollees; and c) erroneous recording of
receivables to the Due from NGAs account
for assessed school fees from CHED and
DepEd amounting to PhP14.11 million;
due to the following: a) discrepancy in
PPE account balances between the GL and
RPCPPE; b) non-reclassification to semi-
expendable property of tangible items
costing below PhP15,000.00 amounting to
PhP32.06 million; c) unserviceable
properties valued at PhP1.92 million
included in the PPE balance; d) non-
provision of depreciation on several PPE
e) recording as PPE of mobilization and
progress payments for on-going
infrastructure projects amounting to
PhP1.71 million; and f) absence of proof of
ownership to the recorded value of Land
 Unreliable reported net income at year-end
of PhP0.28 million due to the absence of
the financial statements, journals and
333
ledgers for each IGPs;
audit; and
to unreconciled balances between the GL
and SLs.
12. University of Eastern   Unreliable year-end balances of the CIB-
Philippines (UEP) LCCA and CIB-LCSA of PhP117.24
due to the following: a) discrepancy in
balances of the accounts as reported in the
Consolidated FSs and Individual FSs; and
between the GL and SLs of the Main
Campus; and b) non-submission of BRSs
for some bank accounts;
provided for Accounts Receivables
 Unreliable year-end balances of the PPE
due to the following: a) completed
projects amounting to PhP3.67 million
were erroneously recorded as CIP-Land
Improvements and CIP-Buildings and
Other Structures; b) payments for progress
billings of infrastructure projects
erroneously recorded to the Buildings,
School Buildings, and Other Structures
accounts; c) PPE items valued at PhP23.82
million were not provided with
depreciation; d) non-submission of
complete and reliable RPCPPE items; and
e) absence of periodic reconciliation of
property records of the Supply and
Accounting Units;
 Understatement of the receivable and
income accounts by PhP3.01 million due
to non-application of accrual basis of
accounting in recognizing income from
school fees; and
 Doubtful existence of Cash-Collecting
Officer account as of 31 December 2015 as
98.77 percent or PhP2.68 million of the
year-end balance were undeposited
collections pertaining to CYs 2004-2011.
13. Regional   Unascertained PPE account balances
Development Council aggregating PhP8.40 million due to non-
(RDC) reconciliation with the balance in the
RPCPPE of PhP4.85 million or a
difference of PhP3.55 million;
 PhP0.34 million, out of PhP0.69 million
disbursements, representing honorarium
paid to Private Sector Representatives who
attended the various meetings as Sectoral
Committee Co-Chairmen and Members of
the RDC Region VIII, were without
supporting documents and no tax was
withheld on this transaction; and
334
 Fuel consumption amounting to PhP0.28
million was not supported with Monthly
Report of Fuel Consumption, and Driver’s
Trip Tickets were not properly filled-up.
TOTAL 13
REGION IX - ZAMBOANGA PENINSULA
1. Western Mindanao   Unrecorded land, with a fair market value
State University of PhP51.19 million;
(WMSU)  Unreliable Other Payables account balance
misclassification of accounts, inclusion of
negative balances and unallocated
difference amounting to PhP26.66 million;
absence of details/breakdowns and
between the GL and SL balances of the
account;
balance amounting to PhP1.14 million due
to inclusion of misclassified accounts,
receivables without details or breakdown,
and non-assessment for impairment of
receivables which remained outstanding
for more than five years.
2. Basilan State College   Existence, completeness and regularity of
(BSC) the Cash Collecting Officer - STF and
CIB accounts amounting to PhP2.68
respectively, as of 31 December 2017
could not be validated due to incomplete
submission by the Collecting Officer of
reports on collections and deposits duly
supported with the corresponding official
receipts and deposit slips from 2011-2017
and failure of the Accountant to prepare
BRSs for all current account from June
2009 up to December 2017;
 Balance under STF could not be validated
due to incomplete submission by the
Collecting Officer of reports on collections
and deposits duly supported with the
corresponding official receipts and deposit
slips from 2011-2014 and failure of the
Accountant to prepare BRSs for STF
account from June 2009 up to December
2016.
3. Zamboanga City   Non-reconciliation of year-end balances of
State Polytechnic PPE accounts as reflected in the statements
College (ZCSPC) amounting to PhP136.14 million with
RPCPPE amounting to PhP123.95 million
with a resulting variance of PhP12.19
million; and
 Understatement of Accounts Receivable
and School Fees/Income from Tuition Fees
by PhP4.09 million due to the method of
recognizing income from tuition fees
which was cash basis instead of accrual
method.
4. Jose Rizal Memorial   Unreliable CIB balance of Main, Dipolog
State University and Katipunan Campuses due to the
(JRMSU) unadjusted reconciling items in the BRSs
335
 Unreliable accuracy of the reported
Inventory balance of the Main Campus in
the FS due to a variance of PhP38.05
million between the Accounting and
Supply records;
 Unreliable correctness and reliability of the
reported PPE balance of PhP543.16
million as of 31 December 2017 due to
non-reconciliation of Accounting records
against the RPCPPE of the Supply Unit
resulting in a net variance of PhP282.95
million and inclusion of tangible items
PhP15,000.00 with aggregate amount of
PhP10.27 million;
 Non-provision of depreciation for 18
percent or PhP64.36 million of the total
PPE of the Main Campus in the current
and previous years resulting in
understatement of expenses and
overstatement of reported surplus;
 Various deficiencies in the recognition of
Biological Assets (BA) and erroneous
charges to the BA account resulted in an
understatement of PhP0.43 million and an
overstatement of PhP1.40 million of the
BA account in the books of the Katipunan
Campus and Main Campus, respectively;
and
 Various discrepancies in the AP of four
campuses amounting to PhP6.32 million
resulted in the overstatement of the
account at year-end.
5. Zamboanga State   Due to non-recording of the billing of free
College of Marine tuition fees and under recording of tuition
Science and fees for the graduate programs for the 2nd
Technology Semester, School Year 2017-2018, the
(ZSCMST) following accounts were understated:
Accounts Receivable by PhP0.376 million,
Due from National Government Agencies
(10303010) by PhP5.307 million, Other
Deferred Credits (20501990) by PhP3.410
million and School Fees-Tuition
(40202010) by PhP2.27 million;
 Accounts Receivable amounting to
PhP14.38 million could not be validated
due to non-submission of Schedule of
Receivable (SAR); and no Allowance for
Impairment of long outstanding accounts
have been provided thus, affecting
valuation of the accounts;
 Settlement of the Receivable-
Disallowances/Charges amounting to
PhP0.71 million could not be ascertained
due to non-attachment of supporting
documents; and refund of disallowances
amounting to PhP8,040.00 were accounted
as a reduction to the account when these
were not set up in the books as Receivable-
Disallowances/Charges;
 Inventory accounts amounting to PhP4.95
million were overstated by PhP4.23
million since the RPCI as of year-end
336
showed inventories on hand amounting to
PhP0.72 million only;
 Fully depreciated PPE amounting to
PhP6.12 million under Regular Fund and
PhP0.26 million under IG Fund were
classified as Non-Current Other Assets
instead of the appropriate PPE account;
 Due to the recognition of contractors’
billings for infrastructure projects not yet
inspected and without statements of work
accomplished as of end of CY 2017, AP
and CIP were overstated by PhP6.76
million, and PhP7.31 million, respectively
and Advances to Contractors was
understated by PhP0.55 million;
 Expenditure accounts had a net
overstatement of PhP0.36 million due to
recognition of prior year expenses of
PhP0.73 million as expenses for the year
and non-recognition of current year
expenditures of PhP0.37 million.
TOTAL 4 1
Note: Consolidated ML was issued for Josephina H. Cerilles State College (JHCSC) due to non-submission of
REGION X - NORTHERN MINDANAO REGION
1. University of Science 
and Technology of
Southern Philippines
(USTsP) (formerly
MUST and
MOSCAT) – CDO
Campus
2. USTsP – Claveria   Existence of dormant receivables of
Campus PhP5.36 million representing unpaid
tuition fees from various defunct sponsors
and receivables from patrons of the
College IGPs; and
 Uncollected loans granted to 238
MOSCAT students from CHED SAFE
loan amounting to PhP1.190 million due to
failure of imposing the sanctions against
the defaulting students.
3. Camiguin   Validity and accuracy of the year-end
Polytechnic State balance of the PPE accounts amounting to
College (CPSC) PhP115.3 million could not be ascertained
due to an unreconciled discrepancy of
general ledger and the results of the
physical inventory of PhP88 million as of
year-end; and the annual inventory report
does not conform to Annex 63 of NGAS
Vol. 2.
4. Bukidnon State   Total liabilities amounting to PhP79.9
University (BSU) million could not be totally relied upon due
to the inclusion of negative balances,
insufficient evidence and long outstanding
payables amounting to PhP1.57 million or
2 percent, PhP3.3 million or 4 percent, and
PhP10.9 million or 14 percent,
respectively;
 Prior-year accounts due to various NGAs
amounting to PhP2.3 million remained in
the liability account for a period of at least
three years to date despite completion of
337
the programs resulting in the overstatement
of total liabilities; and
 Cost of roofing construction and
renovation project of PhP2.2 Million were
charged to repairs and maintenance
account and not capitalized.
5. Central Mindanao   CIB-LCCA of PhP303.68 million as of
University (CMU) 31 December 2017 was understated by
PhP12.15 million to unrecorded credit
memos and advices from various creditors.
6. Mindanao State   Accuracy and reliability of the PPE
University-Iligan accounts amounting to PhP855.85 million
Institute of could not be ascertained due to the
Technology (MSU- discrepancies noted as against the balance
IIT) of PhP721.05 million per Physical
Inventory Report;
 Trust Fund Accounts balances remained
non-moving for five consecutive years or
more; and other accounts remained in the
books which are no longer necessary for
the attainment of the purposes for which
said funds were established;
 An aggregate unutilized balance of
PhP5.01 million for some completed
Programs/Projects which are not remitted
to their respective funding agency until to
date and remained in the books for one
year or more; and
 Three Checking Accounts maintained
within 112 Trust Fund Accounts.
7. Mindanao State   Unreliable PPE accounts balances
University-Naawan amounting to PhP105.76 million due to:
(MSU-Naawan) (a) failure of the Supply Office to prepare
the RPCPPE and maintain PCs, and the
Accounting Office to maintain PPELCs;
and (b) semi-expendable properties were
still accounted as part of the PPE; and
 Non-adherence to rules and regulations on
the grant, utilization and liquidation of
cash advances resulted in the increasing
balance of the unliquidated cash balances
30 June 2017.
8. Northwestern   The College does not possess any
Mindanao State document of conveyance pertaining to the
College of Science parcels of land costing PhP0.58 million
and Technology recorded in the Agency’s Books thereby
(NMSCST) casting doubt on the agency’s rights over
the property and reliability of the Land
account.;
 Biological transformation of the College’s
biological assets were not duly accounted
for eight years;
 Validity and accuracy of the Inventory
could not be relied upon due to: a) non-
maintenance of the SLCs and SCs by the
Accounting Unit and Supply Unit,
respectively, and b) non-preparation of the
RPCI; and
 Semi-expendable properties amounting to
PhP2.88 million were still accounted as
part of the PPE accounts.
338
TOTAL 1 7
Note: MLs were issued for Philippine Carabao Center (PCC), MSU-LNAC, MSU-MSAT
REGION XI - DAVAO
1. Mindanao   Non-conduct of the annual physical
Development count of the agency’s PPE and the
Authority (MinDA) non-submission of the corresponding
RPCPPE as at 31 December 2017 casted
doubt on the accuracy and reliability of the
reported year-end balances of the PPE
accounts amounting toPhP9.11 million;
 Other Supplies and Materials Expenses
included procured semi-expendable
properties, thus affecting the fair
presentation of the FSs; and
 Non-submission of the financial reports
and disbursement documents including the
BRs within the prescribed period.
2. Davao Integrated   Non-conduct of the annual physical count
Development of the agency’s PPE and non-submission
Program -Project of the corresponding RPCPPE as at
Management Office 31 December 2017 created doubt on the
reported year-end balances of the PPE
 Non-submission of the financial reports
and disbursement documents within the
prescribed period affected timely
evaluation and determination on the
validity and accuracy of the agency
accounts presented in the financial
statement
3. Compostela Valley   Understatement of Accounts Receivable
State College (CVSC) and School Fees accounts amounting to
PhP20.2 million and Php16.1 million,
respectively due to non-booking up of
accruals for students’ tuition fees;
 Accuracy and reliability PPE accounts’
balances of PhP131 million or 73 percent
of the total assets is doubtful due to non-
updating of ledger and property cards;
 Unascertained existence and completeness
of the Inventory accounts’ balances of
Php0.6 million due to failure to conduct
physical count and prepare the inventory
report.
4. Davao del Norte State   Receivables - Disallowances/Charges
College (DNSC) account amounting to PhP13.42 million,
representing 68 percent of the total
receivables and 19 percent of total current
assets, remained outstanding in the books
of accounts for more than 20 years without
any subsidiary and/or supporting records.
5. Davao Oriental State   Non-submission by the agency of the
College of Science financial statements/reports and supporting
and Technology schedules as at 31 December 2017 caused
(DOSCST) the limitation in the scope of audit by the
auditor.
6. Southern Philippines   Failure of the Management to conduct the
Agribusiness and annual physical count on the Agency’s
Marine and Aquatic PPE and non-submission of the
School of Technology corresponding RPCPPE created doubt on
(SPAMAST) the accuracy and reliability of the reported
year-end balances of the PPE accounts
339
 Non-submission of FSs on or before the
legal deadline on February 14 of each year;
this has been a recurring audit observation
for the past three years which affected the
timely evaluation and determination on the
accuracy of the agency’s accounts
presented in the FSs.
7. University of   Existence, completeness and ownership of
Southeastern the PPE and Inventory accounts balances
Philippines amounting to PhP243.48 million and
PhP12.69 million or 27 percent and 85
percent, respectively, of the total balances
of the University as at 31 December 2017
could not be ascertained due to absence of
certain reports and reconciliation
procedures;
 Unreliable balance of Accounts Receivable
of PhP83.94 million due to inaccurate
Allowance for Impairment amounting to
PhP1.5 million caused by improper aging
of accounts;
 Non-compliance by the University with
PPSAS 27 – Agriculture, as to the
measurement and disclosure requirements
of the Biological Assets totaling PhP2.70
million;
 Doubtful existence and accuracy of the
CIP account balance amounting to PhP0.61
million due to erroneous entry or lack of
supporting documents to prove its
existence; and
 The University was not able to present the
Reconciliation on the Comparison
Statement of Budget and Actual and the
Statement of Financial Performance in
accordance with PPSAS 24- Presentation
of Budget Information in its FSs.
TOTAL 5 2
REGION XII - SOCCSKSARGEN
1. Cotabato City State   Uncollected rentals on twelve units store
Polytechnic College stalls and a canteen amounting to PhP1.9
(CCSPC) million were not taken up in the books; and
accuracy and completeness of the reported
Revenue could not be ascertained due to
inadequate documentary evidence and non-
timely submission of collection reports.
2. Sultan Kudarat State   Inappropriate accounting for supplies and
University (SKSU) materials inventory resulting in understated
Inventory and overstated Expense
accounts; and
 Improperly valued Notes Receivables,
Loans Receivables, and Biological Assets;
and erroneous balance of Due from
Officers and Employees and various
Expense accounts.
3. University of   CIB – LCCA account cannot be
Southern Mindanao ascertained due to: (a) unrecorded bank
(USM), Kabacan accounts, (b) unreconciled balance, (c)
dormant and unnecessary account
balances, and (d) incomplete submission of
BRSs;
 Improperly valued and non-accrual of
340
receivables and corresponding Allowance
for Doubtful Accounts; and
 APs and Other Payables reported balances
were not fairly presented due to: (a) non-
preparation of the Schedule of Accounts
Payables, and (b) inclusion of negative
balances and improper use of the Other
Payables account.
4. Cotabato Foundation   Improperly valued and non-accrual of
College of Science receivables and corresponding Allowance
and Technology, for Doubtful Accounts; and
Doroluman, North  Supplies and Materials were not recorded
Cotabato using the Perpetual Inventory System.
5. Mindanao State   The University failed to conduct a
University (MSU) – complete physical inventory of all its PPE,
General Santos and delayed preparation of the inventory
report; report showed an unreconciled
difference of PhP54,327 million in
comparison with the Accounting records;
and
 Inappropriate recording and classification
of transactions under the Accounts
Payables and Other Payables accounts.
TOTAL 5
Note: ML was issued for Philippine Carabao Center (PCC)
REGION XIII - CARAGA REGION
1. Caraga State   Unreliable PPE accounts with net amount
University (CSU) of PhP428.91 million due to non-
reconciliation of the accounting and supply
records and the unreliable accumulated
depreciation balance.
2. Agusan del Sur State   School Fees was overstated by PhP18.48
College of million due to non-adjustment of the
Agriculture and unearned portion of the income for tuition
Technology fees at year-end;
(ASSCAT)  AP and related accounts were overstated
by PhP16.5 million due to advance
recognition of obligated amounts;
 Inventory accounts were misstated due to
unrecorded issuances of supplies and
materials and various errors in recording
 Accuracy of the Cash in bank balance
be ascertained due to the non-submission
of the BRSs of all bank accounts.
3. Surigao State College   Inventory - Work in Process account
of Technology balance as of December 31, 2017 is
(SSCT) extremely overstated by PhP35.31 million
due to incomplete/ inadequate recognition
of produced finished good;
 Inventory Report of PPE, with account
balance of PhP224.33 million as of 31
December 2017, was understated by
machinery equipment;
 Cash Advances balance as of 31 December
2017 amounting to PhP3.86 million was
understated by PhP0.76 million due to
negative balances/entries included therein;
and
 Error in recording of grant of Student
Assistance Fund for Education (SAFE)
341
loans to student-beneficiaries resulted in
understatement of Assets (Loans
Receivable-Others) and Liabilities (Other
Payables- SAFE loan) accounts in the
Statement of Financial Position.
4. Surigao del Sur State   Unreliable Cash in Bank account balance
University (SDSSU) amounting to PhP227.47 million due to
incomplete preparation and submission of
monthly Bank Reconciliation Statements
(BRS) by the Tandag, Cagwait and
Tagbina campuses, and SDSSU-Tandag’s
reconciling items representing prior years’
erroneous/ unrecorded transactions which
were carried over and remained unadjusted
as of 31 December 2017; and
 Accuracy and validity of the Other
Payables account of SDSSU – Tandag
Campus amounting to PhP39.12 million as
of 31 December 2017 cannot be
ascertained due to the misclassification of
various revenue accounts and specific
payable accounts, presence of negative
balances, and long outstanding and non-
moving accounts without supporting
documents.
TOTAL 4
REGION XVI - NEGROS ISLAND REGION
1. Central Philippines   PPE and Biological Assets amounting to
State University PhP272.31 million were not supported
(CPSU) with complete PCs/ biological assets PC
(BAPC) and PPELCs and were not
reconciled with the Supply Officer’s
records;
 Unsettled cash advances amounting to
PhP8.67 million as of 31 December 2017;
and
 Non-preparation of BRSs and non-
submission of the same to the Auditor for
all depository accounts in violation of
Section 74 of PD No. 1445.
2. Carlos Hilado   Doubtful PPE accounts’ balances due to
Memorial State non-reconciliation of the RPCPPE with the
College (CHMSC) with the balance per general ledger;
 The College exceeded its budget allocation
for Free Tuition 2017 by PhP19.07 million
contrary to Joint Memorandum Circular
No. 2017-1 dated 20 April 2017 of
Commission on Higher Education (CHED)
and Department of Budget and
Management (DBM).
3. Northern Negros   Doubtful PPE accounts’ balances due to
College State College non-reconciliation of the RPCPPE with the
of Science and with the balance per general ledger
Technology amounting to PhP160.16 million.
(NONESCOST)
TOTAL 3
Note: ML was issued for Negros Oriental State University (NORSU) since no consolidated Financial
Statements and schedules were submitted on even date
GRAND TOTAL 51 225 10 6
Percentage to Total (%) 18 77 3 2
342
VII. SIGNIFICANT AND
COMMON AUDIT
OBSERVATIONS AND
RECOMMENDATIONS
PART VII - SIGNIFICANT AND COMMON AUDIT OBSERVATIONS
AND RECOMMENDATIONS
7.1 Overview
Section 2, Article IX-D of the Philippine Constitution mandates the

Commission on Audit (COA) to regularly conduct audit of accounts of all
National Government Agencies (NGAs). The audit is conducted in accordance
with the International Standards of Supreme Audit Institutions (ISSAIs), with
audit results discussed with concerned Agency officials and incorporated in the
Annual Audit Reports (AARs) and Management Letters (MLs). The AAR or ML
is transmitted to the concerned agency head, with the Office of the President, the
Congress, Oversight Agencies and other stakeholders furnished a copy thereof.
7.2 Audit Opinions
The AAR sets forth the audit opinion on the entity’s financial statements
(FSs). Under International Standard on Auditing (ISA) 705, the auditor shall
modify the opinion in the auditor’s report when: (a) the auditor concludes that,
based on the audit evidence obtained, the FSs as a whole are not free from
material misstatement; or (b) the auditor is unable to obtain sufficient appropriate
audit evidence to conclude that the FSs as a whole are free from material
misstatement. Material misstatement can be considered pervasive when, in the
auditor’s judgment these are: (a) not confined to specific elements, accounts or
items of the financial statements; (b) if so confined, represent or could represent a
substantial proportion of the financial statements; or (c) in relation to disclosures,
are fundamental to users’ understanding of the FSs.
The audit opinions are classified below depending on the results of the
audit:
7.2.1. Unqualified Opinion - Issued when financial statements present fairly, in

all material respects, the entity’s financial position, results of
operations and cash flows in conformity with the Philippine Public
Sector Accounting Standards (PPSAS).
7.2.2 Qualified Opinion – Issued when: (a) the auditor, having obtained
sufficient appropriate audit evidence, concludes that misstatements,
individually or in the aggregate, are material, but not pervasive, to the
financial statements; or (b) the auditor is unable to obtain sufficient
appropriate audit evidence on which to base the opinion, but the auditor
concludes that the possible effects on the FSs of undetected misstatements,
if any, could be material but not pervasive.
7.2.3 Adverse Opinion - Issued when the auditor, having obtained sufficient
appropriate audit evidence, concludes that misstatements, individually or in
the aggregate, are both material and pervasive to the FSs.
343
7.2.4 Disclaimer of Opinion - Issued when the auditor is unable to obtain
sufficient appropriate audit evidence on which to base the opinion, and the
auditor concludes that the possible effects on the FSs of undetected
misstatements, if any, could be both material and pervasive or in extremely
rare circumstances involving multiple uncertainties, the auditor concludes
that, notwithstanding having obtained sufficient appropriate audit evidence
regarding each of the individual uncertainties, it is not possible to form an
opinion on the FSs due to the potential interaction of the uncertainties and
their possible cumulative effect on the FSs.
7.3 Results of Audit
The audit opinions issued on CY 2017 FSs and operations of 292

NGAs, and State Universities and Colleges (SUCs) and Stand –Alone
Agencies are broken down as follows:
Type of Opinion No. of NGAs No. of SUCs Total %

Unqualified 43 8 51 18
Qualified 126 99 225 77
Adverse 9 1 10 3
Disclaimer 3 3 6 2
Total Opinions Issued 181 111 292 100
MLs were issued to agencies which failed to submit on time their FSs for
audit as required under Section IV.B.3 of COA Memorandum No. 2014-011
dated 21 October 2014. The corresponding AAR shall be issued by the concerned
Auditors for Agencies that were able to submit their FSs not later than 30 June
2018. For agencies that were not be able to submit the FSs on the said date, the
issued ML will be considered in lieu of the AAR and will be posted in the COA
website.
The 51 agencies issued with unqualified or clean audit opinion

are the following:
1. Bureau of Broadcast Services (BBS)

2. Bureau of Communication Services (BCS)
3. Climate Change Commission (CCC)
4. Commission on Filipino Language (CFL)
5. Fertilizer and Pesticides Authority (FPA)
6. Games and Amusements Board (GAB)
7. Governance Commission for GOCCs (GCG)
8. Housing and Land Use Regulatory Board (HLURB)
9. Housing and Urban Development Coordinating Council (HUDCC)
10. Movie and Television Review and Classification Board (MTRCB)
11. National Commission on Culture and the Arts (NCCA)
12. National Commission on Indigenous Peoples (NCIP)
13. News and Information Bureau (NIB)
14. National Intelligence Coordinating Agency (NICA)
15. Office of the President (OP)
16. Office of the Vice-President (OVP)
344
17. Philippine Commission on Women (PCW)
18. Philippine Competition Commission (PCC)
19. Presidential Legislative Liaison Office (PLLO)
20. Presidential Management Staff (PMS)
21. Central Board Assessment Appeals (CBAA)
22. Government Procurement Policy Board-Technical Support Office
(GPPB-TSO)
23. Insurance Commission (IC)
24. National Tax Research Center (NTRC)
25. Philippine National Volunteer Service Coordinating Agency
(PNVSCA)
26. Public-Private Partnership Center of the Philippines (PPPP)
27. Commission on Appointments (CA)
28. House of Representatives (HOR)
29. House of Representatives-Electoral Tribunal (HRET)
30. Senate of the Philippines
31. Senate Electoral Tribunal (SET)
32. National Defense College of the Philippines (NDCP)
33. Parole and Probation Administration (PPA)
34. Office of the Government Corporate Counsel (OGCC)
35. National Book Development Board (NBDB)
36. Institute for Labor Studies (ILS)
37. Civil Aeronautics Board (CAB)
38. Toll Regulatory Board (TRB)
39. Energy Regulatory Commission (ERC)
40. National Water Resources Board (NWRB)
41. Philippine Trade Training Center (PTTC)
42. Intellectual Property Office of the Philippines (IPOPHL)
43. Design Center of the Philippines (DCP)
44. Ifugao State University (IfSU)
45. Kalinga State University (KSU)
46. Mountain Province State Polytechnic College (MPSPC)
47. North Luzon Philippine State College (NLPSC)
48. Bulacan Agricultural State College (BASC)
49. Don Honorio Ventura Technological State University (DHVTSU)
50. Tarlac State University (TSU)
51. University of Science and Technology of Southern Philippines
(USTsP)-CDO Campus
An adverse opinion was issued to the following 10 agencies:
1. Department of Foreign Affairs (DFA)

2. Bureau of Customs (BOC)
3. Supreme Court of the Philippines (SCP)
4. Armed Forces of the Philippines-General Headquarters (AFP-GHQ)
5. Bureau of Immigration (BI)
6. National Museum (NM)
7. Department of Information and Communication Technology (DICT)
8. Philippine Council for Health Research and Development (PCHRD)
9. Department of Public Works and Highways (DPWH)
345
10. Eastern Visayas State University (EVSU)-Region 8
The issuance of adverse opinion was primarily due to:
(a) unreliable Cash and Cash Equivalents account balances in view of

unremitted collections, abnormal or unaccounted balances,
unidentified bank accounts, unadjusted/unrecorded reconciling
items, unsupported cash transactions, unreconciled balances
between SLs and bank confirmation, delayed recording of
collections and deposits, and submission of Bank Reconciliation
Statements, or unliquidated cash advances;
(b) unascertained balances of Receivables accounts, particularly the Due

from NGAs/GOCCs/LGUs as a result of discrepancies or non-
reconciliation of records, long outstanding, dormant collectibles,
unidentified/unverified items without supporting documents or non-
provision for Allowance for Impairment;
(c) doubtful Inventory/Property, Plant, and Equipment (PPE) balances

given the unreconciled Accounting and Property records, failure to
conduct physical inventory of Agency assets or submit the required
inventory reports, unrecorded assets, and erroneous recording of
transactions like classifying semi-expendable properties under PPE
or inclusion of completed projects under the Construction-in-
Progress (CIP) accounts;
(d) existence of long dormant Accounts Payable without valid claimants

and supporting documents, or recognition of obligations which are
not yet due and demandable;
(e) uncollected/unrealized revenues/income caused by non-imposition

of fines, fees, and charges; and
(f) other errors/omissions/deficiencies resulting in misstatements of

various accounts and affecting the fair presentation of the year-end
balances in the FSs, among others.
A disclaimer audit opinion was issued to the following six agencies

mainly due to inability of the agencies to submit the required financial
statements/reports, supporting schedules and documents, disbursement vouchers
and other pertinent requirements covering the transactions for CY 2017:
1. Philippine Statistics Authority (PSA)

2. Rizal Technological University (RTU)
3. Construction Industry Authority of the Philippines (CIAP)
4. Basilan State College (BSC)
5. Davao del Norte State College (DNSC)
6. Davao Oriental State College of Science and Technology (DOSCST)
346
7.4 Significant Audit Observations and Recommendations
The significant audit observations and recommendations on the audit of

NGAs, submitted by auditors of the National Government Sector (NGS) and
Regional Offices (ROs) of this Commission, are presented below.
7.4.1 Reported unutilized appropriations/unobligated allotments/unused

budget amounting to at least PhP99.283 billion, out of total
appropriations/allotment received of PhP902.517 billion, in 52
agencies signifying inadequate planning and budgeting or
inefficient program/project implementation, thus, the non-delivery of the
expected outputs and results from program/projects and operations.
Total
Unutilized
Audit Allotment Program or Project
Cluster Agency Amount
Observation Received Affected and Reasons
(in M PhP)
C1 CFO Unutilized 2.66 4.42 Failure to fully implement
budget the activities for two projects
planned for CY 2017
C2 DBM Unobligated 272.90 1,329.37 Inability of Management to
allotments/ take full advantage of the
funds allotment/ funds received
C5 DepEd Unutilized 8,319.94 85,109.66 Various programs such as
allotments Government Assistance to
Students and Teachers in
Private Schools and in Non-
DepEd Public Schools
(GASTPE), Science and
Math Equipment (SME)
Program, School Based
Feeding Program (SBFP),
and Basic Educational
Facilities Fund-School
Furniture Program due to
shortfall in grantees,
recurring problems in the
procurement, decrease in the
actual number of
beneficiaries, among others
Unobligated PS allotment
due to 6,433 unfilled
positions of teaching and
non-teaching personnel for
the new items and natural
vacancies (retirement/
resignation/transfer), over-
allotment provided to
Implementing Units (IUs),
unavailability of new
applicants for specific
track/strand and transfer of
plantilla items from IUs to
Non-IUs.
ECCDC Unobligated 25.80 487.54 Various programs/projects
allotment due to: unfilled plantilla
positions, failure to carry-out
planned procurement
activities, overestimated
budget, and continuous
347
Total
Unutilized
(in M PhP)
C5 budget allocation for
licensing/registration/accredi
tation monitoring service
that has been unimplemented
since CY 2014
NM 141.30 644.28 Recurring delays in the
conduct of procurement for
the infrastructure projects in
the prior years, insufficient
manpower capacity,
unrealistic Annual
Procurement Plan
(APP)/Procurement Project
Management Plan (PPMP)
PNU Unutilized 95.88 224.12 Programs/projects intended
budget- for the educational needs of
Special Trust students and faculty due to
Fund deficient programming,
execution and reporting
MPC Unutilized 0.78 0.91 Tulong Dunong Program
appropriation (SUCs-TDP) due to failure
to create a Student Financial
Assistance Programs
(StuFAPs) Committee; non-
observance of CHED-DBM
Joint Memorandum Circular
(JMC) No. 2017-3 dated 24
May 2017
0.69 1.09 Expanded Students' Grants-
in-Aid Program for Poverty
Alleviation (ESGP-PA) due
to non-observance of the
enhanced implementing
guidelines
EARIST Unobligated 2.90 4.79 SUCs-TDP due to failure to
allotment create a StuFAPs Committee
caused by the Institute’s lack
of awareness of CHED-
DBM JMC
PUP Unutilized 38.52 46.61 SUCs-TDP due to pre-
appropriations allocation of appropriations
to legislators by the PUP
Budget Office and
procedural lapses in
accepting applications by the
Scholarship and Financial
Assistance Services
34.60 50.30 ESGP-PA due to non-
observance of the prescribed
timelines
PhilSCA Unobligated 15.93 79.08 STF-PS due to unfilled/
allotment for vacant positions
PS, MOOE 3.14 25.55 MOOE training and
and Capital scholarship grants due to
Outlay (CO) utilization of STF in lieu of
MOOE
0.95 54.95 Infrastructure and Facility
Development due to delayed
procurement and delivery of
services
348
Total
Unutilized
(in M PhP)
C5 CHED Unutilized 6,551.22 16,445.51 Free Tuition 2017, K to 12
Allotment Transition Program, and
1,886.80 Philippine California
Advanced Research
2,236.91 Institutes (PCARI) due to
delayed payments of
SUCs billings/scholarship
privileges and research funds
TESDA Unobligated 609.61 8,348.94 Various programs/projects
Allotment due to delayed procurement/
bidding particularly for COs
DOLE Unutilized 392.11 500.00 DOLE Adjustment Measures
Appropriation Program (AMP) for
after two Displaced Workers in the K
years to 12 Curriculum due to
excessive appropriation; only
606, out of the 14,243
Higher Education Institution
(HEI) personnel, availed the
program
C6 NAST Below 75 10.65 13.38 Various projects like
percent Salinlahi in Transition:
utilization of Transforming the Philippine
project funds; Science Heritage Center
unutilized (PSHC) into a World Class
appropriations Science Center due to
for CO inadequate planning and
implementation, and deferral
of procurement
PSHS Low 169.86 872.79 CO due to limited capability
utilization to implement infrastructure
rates of projects and procurement of
allotment highly technical equipment
TAPI Unutilized 29.24 30.00 CO due to utilization rate of
Allotment 2.5 percent only
2.62 2.62 CO due to procurement
issues
ASTI Undisbursed 1,380.00 2,207.00 Delayed conduct of initial
funds procurement activities, and
inefficient budget planning
and project implementation
FNRI Unutilized 33.56 76.99 Delays in the procurement of
Allotment supplies and equipment were
incurred due to the late
conduct of procurement
activities
DICT 7,053.00 12,576.00 Projects such as National
Government Data Center,
Free Internet Wi-Fi
Connectivity in Public
Places, National Spectrum
Monitoring, Philippine
Government Interoperability
Exchange, Upgrading of
ICTO Network and
Equipment, Validation,
Integration and
Characterization of Thin
Client, Tech4Ed, and
Government Operational
Management Platform; due
349
Total
Unutilized
(in M PhP)
C6 to substantial delay in
procurement processes/
activities attributed to delay
in TOR preparation, conduct
of market study or lack of
BAC Secretariat manpower,
among others
CWC Unutilized 10.59 58.37 Delay/non-implementation
allotment of projects under the Child
Welfare Policy Services
Program resulting in delayed
and/or non-accomplishment
of the expected outputs
within the target year
PTRI 5.97 13.69 Locally-funded
infrastructure projects due to
failure to undertake initial
procurement activities
PCHRD 37.77 40.00 Planned projects under the
Council’s Climate Change
and Disaster Risk Reduction
Program due to partial
implementation of projects
MIRDC 97.66 126.32 Locally Funded Projects
(LFP) due to non-
accomplishment of several
expected projects and
outputs
PNRI 43.10 339.78 Locally funded projects and
continuing funds; noted
substantial fund transfers to
International Atomic Energy
Agency (IAEA) for CYs
2015 to 2017
C7 ERC Unutilized/ 184.59 680.04 Consultancy services and
expired/ PPE contracts due to internal
lapsed administrative issues within
allotment the Commission which
delayed the procurement
process; PS and MOOE
savings due to activities no
longer pursued
DOE Unutilized 756.58 2,975.33 Projects/programs such as
budget RAF and other locally-
funded projects due to
inability of Affiliated
Renewable Energy Centers
(ARECs) to comply with
their counterpart requirement
to fund 10 percent of the
project, failed or prolonged
procurement activities, and
inadequate technical
manpower, among others.
NPDC Unutilized 3.56 266.52 PS, MOOE and CO due to
allotment delays in procurement
process or implementation of
repairs and maintenance of
buildings and structures, or
unpaid obligations/ delayed
claims
350
Total
Unutilized
(in M PhP)
C7 PCG Unutilized 64.70 8,484.91 Continuing Appropriations
allotment for MOOE and Capital
Outlay due to MFO activities
and PPE procurement
activities no longer pursued
during the year
MARINA 203.79 1,319.75 Delayed implementation of
projects and activities such
as Digitization of
Documents, Development
and Installation of an
Integrated MARINA
Domestic Shipping System
(IMDSS), and procurement
of 350,000 pieces SIRB/
Stickers
MMDA 667.13 5,067.14 Due to delays in the
implementation of flood
control projects, changes in
the MMDA Management
and late scheduling of
procurement activities
DOT 334.01 3,772.95 Due to delayed
implementation of projects
and activities, unused
ASEAN funds and
unobligated income from
Duty Free Philippines Inc.
and MOOE activities under
MFOs 1 and 2
49.91 52.05 Tourism Development Fund
(TDF) due to the late
formulation of guidelines,
delayed preparation of the
Special Budget, and late
submission of necessary
documents to the DBM
DPWH 51,757.58 662,690.83 COs due to delayed/non-
implementation of various
infrastructure projects
MVUC 1,359.97 13,123.40 Delayed initiation of
procurement process/bidding
activity due to issues on the
details of the projects such as
LRS-Fabrication & Delivery
Onsite of Locational
Referencing Points (LRPs),
Consultancy Contract for
Locational Referencing
System (LRS)-Ph III,
Installation of Kilometer
Posts under the project
“Establishment of City and
Provincial Locational
Referencing System",
National Road Lighting
Program - Package 10
OTS 246.43 1,372.04 Excessive allotment for mid-
year and year-end bonuses,
savings from MOOE and CO
351
Total
Unutilized
(in M PhP)
C7 DOTr Unutilized 13,603.14 71,203.16 Slow implementation of 144
allotment locally funded and foreign
funded projects due to
projects put on hold pending
decision by top management,
and change in policy
directions, delayed
procurement
C8 NAMRIA Lapsed 1.62 7.36 Failure of bidding caused by
allotment- the absence of pre-qualified
Continuing bidders and their failure to
Appropriation comply with the technical
requirements of the project
PRRC Unutilized/ 16.63 226.31 Uncontrollable factors in the
lapsed procurement process like
allotment failure of bidding caused by
the absence of pre-qualified
bidders and their failure to
comply with the technical
requirements of the project
R2 BSC Lapsed 25.00 25.00 Construction of BSC Gym
allotment and Amphitheater due to
delay in the preparation
ofhe required documents
Under- 4.32 6.04 TD and ESGP-PA programs
utilized funds due to deficient targeting of
beneficiaries, lack of
coordination with oversight
offices, and untimely
program implementation
CSU 0.80 38.80 TDP and ESGP-PA
scholarship programs due to
lapses in evaluating the
University’s compliance
with the guidelines; deficient
targeting of beneficiaries;
lack of coordination with
oversight offices; and
untimely implementation of
the program
NVSU Unutilized 3.08 12.31 TDP and ESGP-PA
allotment programs
R4-B PSU Unobligated/ 113.59 150.82 STF Fiduciary Fees due to
unutilized non-preparation of a STF
fund Budget supported with
Schedule of Fiduciary Fees
R5 BiSCAST Unutilized 3.63 17.67 ESGP-PA due to failure to
appropriation reach the allotted 286
scholarship slots for 2017-
2018
Unutilized 36.54 68.01 STF budget due to failure to
budget maximize the utilization of
the fund to improve physical
CSPC 24.22 142.22 facilities for students'
benefits
R8 EVSU Reverted 16.06 20.68 TDP due to Management;s
funds inability to fully obligate
funds
352
Total
Unutilized
(in M PhP)
R8 Unutilized 57.20 82.41 CO budget due to inadequate
budget planning and delayed/ non-
implementation of identified
projects
LNU Unutilized 51.37 87.41 CO- FY 2017 GAA and FC-
allotment/ 05 budget due to inadequate
budget 37.83 58.77 planning and performance of
regular and thorough
monitoring, inspection and
supervision of the projects
PIT 53.92 87.41 CO and FC-05 budget due to
4.09 9.31 inadequate planning
NSU 21.45 87.41
R9 JRMSU Unutilized 22.88 Not stated TDP Grant
ZSCMST allotment 2.05 5.46 TDP due to non-payment of
financial assistance
ZCSPC 5.28 Not stated TDP
WMSU 43.05 659.82 Non-implementation of
scholarship projects/
programs/activities and other
MOOE and CO
R10 MSU-IIT Unutilized 0.57 1.29 Center of Development in
fund Filipino Research Program
due to two projects not
pursued as problems in the
bidding process of procuring
books were encountered
TOTAL 99,283.23 902,516.69
7.4.2 Unutilized Notice of Cash Allocations (NCAs) were reported in 29

agencies amounting to PhP40.907 billion, out of the total NCAs received
of PhP489.427 billion, which automatically lapsed or reverted to the BTr,
primarily due to slow project implementation, delays in procurement, or
unrealistic Monthly Disbursement Program (MDP), among others,
thereby hindering the timely attainment of the program/project's
intended purpose:
Unutilized Total NCAs

Audit Amount Received Program/Project
Cluster Agency
Observation Affected and Reasons
(in M PhP)
C2 BTr Unutilized 2,600.82 2,600.82 Program/Activities/Projects
Proper NCAs (PAPs) due to deficiencies in
planning, operation and
implementation
DBM 344.27 2,546.15 No program/project
affected; the Agency
accomplished more than its
targets
C5 DepEd Lapsed 12,386.10 46,121.95 Funded programs/projects
NCAs not completely implemented
as planned
PNU Unutilized 2.70 6.26 SUCs-TDP due to
NCAs delayed/late release of funds
353
Cluster Agency
(in M PhP)
C5 PUP Lapsed 11.88 28.41 SUCs-TDP due to internal
NCAs control/procedural
weaknesses in the processing
of financial benefit claims of
the student/grantee, and
monitoring
2.84 18.54 ESGP-PA due to inadequate
monitoring affecting the
timely release of the stipend
to student-grantees
C6 NPC Reverted 180.94 275.54 CO due to unimplemented
NCAs projects/ activities
programmed under CY 2017
GAA such as Leasehold
Improvements and the
structured Cabling System of
the new permanent office at
the Philippine International
Convention Center (PICC),
Forensic Laboratory,
ICT/Network Infrastructure,
Data Center and Furniture
and Fixtures, etc. caused by
slow procurement activities
NTC Unutilized 0.20 14.80 Regular MDS Account of
NCAs - RO VI; additional funds
NTC, requested were not optimally
Region VI utilized
POPCOM Reverted 34.24 180.37 Due to delay in procurement
NCAs- process like awarding and
POPCOM- approval of contracts, and
CO and excess NCA received over
NCR the cash program amount
C7 OTC Reverted 1.18 27.73 No program/project affected
NCAs due to PS and MOOE
savings and unpaid liabilities
TRB 0.46 28.65 No program/project affected
due to PS and CO savings
and unpaid liabilities
CAB 1.77 111.70 No program/project affected
pertained to unbilled
liabilities
ERC Unutilized 216.17 648.26 MOOE and CO such as
NCAs consultancy services,
purchase of office building
for the Visayas Field Office
and ICT equipment, training
or traveling expenses, etc.,
which were programmed
activities but not conducted
or implemented
IA 413.34 453.43 Delayed implementation of
the Strategy for the Inclusive
Mainstreaming of People’s
Living Entitlement
(SIMPLE) Phase I-Offsite
Resettlement/ Relocation
project due to lack of
technical capability of IA to
implement said project
354
Cluster Agency
(in M PhP)
C7 NPDC Unutilized 33.56 222.24 Mainly due to minimal
NCAs delivery of goods/services by
suppliers, late awarding of
contracts, and delayed
billing/claims of service
providers for security and
janitorial services
MARINA 70.22 1,194.30 Delayed procurement of
Seafarers Identification and
Record Book (SIRB) and
Seafarer’s Identification
Document (SID)
consumables due to
MARINA-CO re-
organization; Amendment of
MARINA Circular on SIRB;
and Pending procurement
contract of SID System with
PITC
DOT 681.23 4,277.94 Due to the following: (a)
National Organizing
Councils’ (NOCs) sudden
changes in schedule of
events/sites for the ASEAN
meetings, (b) late receipt of
Yolanda Comprehensive
Rehabilitation and Recovery
Plan’s (YCRRP) fund for
Tourism Infrastructure and
Livelihood projects, (c) late
releases of NTAs/fund
transfers to ROs and
unrealistic estimate of the
funds, (d) inability to
project/prepare a realistic
MDP
DPWH 3,729.22 370,991.28 Delayed physical delivery of
the obligated national road
networks, flood control,
school buildings, FMR, and
other infrastructure projects
MVUC 250.95 8,847.47 Mainly due to the terminated
National Road Lighting
Program (NRLP) Package 10
and delayed physical
delivery on road safety and
pollution control projects
OTS 444.59 1,264.38 Pertained mainly to the cost
of undelivered Security
Screening Equipment (SSE),
motor vehicles, military and
police equipment by PS-
DBM, and unbilled cost of
repairs of SSE and
contracted K-9 services by
service providers
DOTr 18,336.47 43,796.05 Attributed to: (a) over
release of NCAs by the
DBM not in accordance with
DOTr’s submitted Monthly
Disbursement Program
(MDP), (b) delayed conduct
355
Cluster Agency
(in M PhP)
and/or failed public bidding,
late deliveries of items
purchased, and approval of
contracts and MOAs, (c)
attribution of allotments for
North-South Rail Project –
Phase 1 from locally-funded
(GOP) to foreign-assisted
(Loan Proceeds), (d) release
of NCA for obligation not
yet due and demandable like
the money claim of
Amalgamated Motors,
(Philippines), Inc. (AMPI)
and PPI-JKG Philippines,
Inc., and (e) delayed
submission of billings with
complete supporting
documents from consultants
and contractors
C8 NWRB Reverted 42.02 165.21 Delay in the implementation
NCAs of various projects and
savings
NAMRIA Lapsed 348.00 1,787.02 Non-delivery of specialized
NCAs instrument from international
supplier for hydrography
vessels
EMB Reverted 495.88 2,386.50 No proper planning
NCAs problems on the bidding
process regarding the
procurement of Air Quality
Monitoring Equipment, and
delay from the downloading
of fund from EMB – CO
PRRC Lapsed 96.65 269.58 Delayed implementation of
NCAs Estero de Paco project
CAR BSU Reverted 70.42 578.18 Recurring issues on project
NCAs planning and procurement
resulting in delayed
implementation of
infrastructure projects
R4-B RSU 24.69 265.50 Delay in NCA releases for
the 4th quarter hence, limited
period for disbursements
Unutilized, 0.47 0.49 Cancellation of transaction
unreverted on payment to a supplier
NCAs who submitted an erroneous
account details
OMSC Unutilized 0.26 0.26 Unutilized funds from other
funds from National Government
other NGAs Agencies intended for
Scholarship Programs
amounting to P255,452.40
(DOLE - P202,091.60,
DOST - P7,360.80, CHED -
P46,000.00)
Unutilized 0.53 Not stated Fund balance from prior
fund balance year’s grants for over a year
unutilized depriving
scholars/grantees of the
immediate use of funds for t
356
Cluster Agency
(in M PhP)
R4B their educational expenses
Unutilized 0.74 0.74 Funds from DAR, CHED,
funds from DOST and DA intended for
other Research and Development
National Extension Projects such as
Government CHED - PhP0.32M, DOST -
Agencies PhP0.31M, and DA -
PhP0.11M
R9 BSC Unutilized 33.89 171.65 Inability to project and
NCAs prepare a more realistic
MDP
R11 CVSC Reverted 50.26 145.45 Delayed implementation of
NCAs PAPs
TOTAL 40,906.96 489,426.85
7.4.3 The Auditors recommended that concerned officials:
7.4.3.1 Revisit the Agency’s planning/budgeting procedures and cash

management program and review/evaluate PAPs and their respective
budgets; strengthen fiscal management; formulate realistic targets
and budget for the year considering the absorptive capacity of the
Agency; and prepare an attainable cash requirement forecast;
7.4.3.2 Institute/adopt strategic measures to ensure timely implementation of

the Agency’s PAPs, optimize utilization of appropriations/
allotments/ budget/funds within the current year as well as maximize
the use of Notice of Cash Allocations (NCAs) received by installing
a budget performance tracking system to monitor the allotments,
obligations and disbursements;
7.4.3.3 Evaluate the causes of the delays in program/project implementation

and propose corrective measures to ensure optimal fund utilization;
and ensure all procurement activities are carried out as planned by
identifying the lapses in the procurement process of the Agency and
instituting mechanisms to address these issues like requiring the Bids
and Awards Committee (BAC) to promptly start the procurement
process;
7.4.3.4 For the SUCs, to: (a) make representation to CHED to expedite fund
releases and cause the immediate disbursements of the financial
assistance under its various scholarship programs such as StuFAPS,
TD and ESGP-PA; require strict compliance with the enhanced
implementing guidelines as set forth in the CHED-DBM-DSWD-
DOLE Joint Memorandum Circular No. 01 dated 23 June 2016, Joint
CHED and DBM Memorandum Circular No. 2017-3 dated 24 May
2017, and CMO No. 13, series of 2014; (b) adopt measures to
effectively fast track the implementation of the FC-05 and GAA-
funded projects to ensure maximum utilization of budgeted funds and
timely delivery of upgraded, improved and modernized facilities and
357
equipment as required under Republic Act (RA) No. 8292, the
Higher Education Modernization Act of 1997; and (c) prioritize
unimplemented projects funded from the University’s income that
are considered urgently needed to improve the facilities, upgrade the
equipment, and provide maximum benefits for the students and better
services to other stakeholders.
7.4.4 Despite availability of allotments/funds, a number of programs/projects

were not fully implemented or its implementation delayed for various
reasons, not in accord with issued guidelines/approved contract, or
doubtful given the absence of basic documentary requirements resulting in
non-attainment of mandated services.
7.4.4.1 Scholarship/Student Assistance Program/Projects
a) The targets and benefits from various scholarship/student assistance

programs/projects with total funding of PhP3.548 billion in 18
agencies/SUCs may not be attained due to failure to follow the
implementing guidelines resulting in low availment, double/excess
payments, non-completion of degrees by the scholars, among others.
Amount
Cluster Agency Program Remarks
(in M PhP)
C5 PNU SUCs-TDP 2.70 Deficiencies in program implementation
include: (a) unobserved application
procedures for availment of grant; (b)
absence of documentary requirements in
the selection of grantees; (c) non-
submission of quarterly reports on the
utilization of funds, including the list of
beneficiaries, and (d) non-posting in the
University Website depriving the qualified
beneficiaries of funds for their educational
needs
ESGP-PA 0.35 Funds for the implementation of the
program were utilized for the payment of
honorarium of personnel limiting the
resources of the PNU Scholarship and
Financial Assistance Services
CHED K to 12 3,402.55 Lapses in the project implementation
Transition observed in the management of the
Program program such as delayed payments due to
lack of absorptive capacity of the Project
Management Unit (PMU), deferment of
approved grantees, low accomplishments
and non-monitoring of approved
researched grants rendered the program
inefficient
C6 PSHS Scholarship Not stated Non-inclusion of Annual Home Visitation
Program in the Guidelines on Scholarship
Categorization (Western Visayas Campus)
6.58 Uncollected receivables from defaulting
scholars
CAR IFSU SAFE Loan 0.63 Inefficient collection of loans receivable
Program
R1 MMSU TD 4.53 Failure to strictly follow the implementing
Scholarship guidelines on the selection of Student
Program Grantees depriving qualified and deserving
scholars
358
Amount
(in M PhP)
R2 CSU DA-ACEF 0.22 Delayed release of stipends to grantees at
Sanchez Mira Campus due to late
liquidation of previous cash advances and
lack of coordination with the scholarship
provider
TD/ 0.80 Lapses in evaluating the University’s
ESGP-PA compliance with the guidelines for said
scholarship grants, deficient targeting of
beneficiaries, lack of coordination with
oversight offices and untimely
implementation of the program
Not stated 0.17 Fifteen (15) scholarship grantees claimed
multiple scholarship grants for the 2nd
semester of School Year 2016-2017
BSC TD/ 4.32 Deficient targeting of beneficiaries, lack of
ESGP-PA coordination with oversight offices, and
untimely implementation of the programs
ISU DA-ACEF 0.54 Grantees claimed multiple scholarship
Scholarship grants defeating the purpose for which the
Program financial assistance are granted
QSU Not stated 0.62 Scholarship benefits granted to students
who were not enrolled in priority courses
outlined by CHED Memorandum No. 01,
s. 2014
R4-B OMSC CHED - 4.62 Delays ranging from one to 98 days in the
StuFAPs release of the financial benefits of
scholars/grantees hence, not complying
with the duties and responsibilities as one
of the implementers of the Student
Financial Assistance Programs (StuFAPs)
PSU ESGP-PA 19.94 Failed to fully perform its responsibility as
co-implementers due to: (a) not requiring
student grantees to open Automated Teller
Machine (ATM) bank account; (b) late
monthly release of financial benefits to the
student-grantees, (c) non-submission to
the House Committee on Appropriations
and Senate Committee on Finance and the
non-posting in the website of the quarterly
reports and list of student grantees, and (d)
non-maintenance of separate books of
account for the program
R5 BiSCAST ESGP-PA 3.63 Did not reach the allotted 286 scholarship
slots for 2017-2018 hence, not realizing
the program objective of addressing
poverty alleviation
R6 CSU Educational 2.32 Improper and inefficient utilization of
Assistance financial assistance to student grantees
to Students
R8 EVSU TD 16.06 Failure to fully obligate funds for one
academic year (AY 2017-2018) allocation
for the 2,253 student grantees
ESGP-PA 13.51 Slot allocation for scholars not totally
filled-up and the accuracy and validity of
the actual number of qualified scholars
unascertained
R9 JRMSU SUCs-TDP 42.91 Implementation of the programs involving
3,812 student grantees showed: a) late
releases of grants by JRMSU System,
b) accounting deficiencies such as
unrecorded releases during the year,
unrecorded receipts and payments and
excess of funds not returned to the General
Fund; and c) releases of financial benefits
359
Amount
(in M PhP)
not made directly to the grantees based
through issuance of check or Automated
Teller Machine (ATM)
R9 ZSCMST ESGP-PA 12.12 Only 95.15 percent of the 196 allocated
slots benefited from the program for SY
2017-2018, a decrease by 2.30 percent
ZCSPC TD 8.71 Implementation of the program involving
913 student grantees showed: a) late
releases of grants, and b) releases of
financial benefits not made directly to the
grantees through issuance of check or
ATM
R16 CPSU Student 0.15 Student Microloan Fund for students
Microloan enrolled in Diploma of Agricultural
Technology had been outstanding for over
nine years.
TOTAL 3,547.98
The following observations were also noted in three other SUCs although
the amount involved was not stated:
R5 BU Scholarship Extended schooling of 198 grantees with no sense of
for SUC urgency to finish school hence, increasing the
personnel/ scholarship/training expenses
SSC faculty Faculty member of SSC committed breach of the terms
member and condition of the scholarship contract by not
completing the program within the given period of time
R9 WMSU SUCs-TDP Selection process of some student grantees not in
accordance with implementing guidelines
7.4.4.2 The Auditors recommended that concerned officials should strictly observe
the implementing guidelines of the various scholarship programs under the
Commission on Higher Education (CHED) - Student Financial Assistance
Programs (StuFAPs), Tulong Dunong (TD), Expanded Students’ Grants-in-
Aid Program for Poverty Alleviation (ESGP-PA) such as the CHED
Memorandum Order No. 13 series of 2014, CHED DBM Joint
Memorandum Circular (JMC) No. 2017-03 dated 24 May 2017, CHED-
DBM-PASUC-DSWD-DOLE JMC No.2014-1 dated 3 February 2014 as
well as CHED Memorandum Order No. 25, series of 2008 for SAFE Loan
Program.
7.4.4.3 Deficient planning, supervision and monitoring, delay in procurement/

delivery of materials/equipment, non-compliance with requirements/
contract provisions, non-imposition of sanctions, and non-compliance
with operational guidelines, among others, led to partial/
non-implementation of infrastructure projects in 27 agencies
amounting to PhP134.982 billion, and other various program/projects
in 28 agencies amounting to PhP13.611 billion. The amount of affected
projects was not disclosed in five other agencies.
360
Program/ Amount
No. Cluster Agency Remarks
Project (in M PhP)
A. Infrastructure Projects
1 C2 NEDA Awang–Upi– 3.20 Unimplemented impact
Lebak- evaluation of the Road project
Kalamansig- in CY 2017 due to procurement
Palimbang- and contract processing issues
Sarangani Road
Project
2 C5 NM Construction of 5.00 Unimplemented due to
a monument in misunderstanding with regard
the Provincial to the location of the sculpture
Capitol, Agusan
del Sur
3 PNU Repair and 11.45 Uncompleted and low
renovation of percentage of completion of
PNU Geronima 58.58 percent due to problems
T. Pecson Hall encountered attributed to poor
at Ground Floor, planning
Taft Wing of
Heritage
Building
4 PUP Repair/ 174.23 Appropriation for three
Rehabilitation/ infrastructure projects were
Construction of reverted to the BTR at the close
Buildings of FY 2016 due to the
funded under unresponsiveness in the Post-
FYs 2015 and Qualification of the contractor
2016 GAA who obtained the Lowest
Calculated Bid, insufficiency of
the appropriation, and absence
of bidder during the opening of
bids last December 2016; while
only one, out of the four
infrastructure projects funded
under FY 2016 GAA was
started during the end of the
3rd Quarter of CY 2017
denying the students and the
general public from the
immediate use of upgraded,
modernized and safe structures
Repair/ 86.41 Three infrastructure projects
Rehabilitation/ under FY 2017 GAA have not
Construction of yet started due to delays in pre-
Buildings procurement activities thus,
funded under target completion dates were
FY 2017 GAA not observed.
5 UPS Various Locally 1,270.92 Delayed implementation of 18,
Funded Projects out of 41 projects, in UP
Diliman and UP System
Administration
Various 175.41 Delayed implementation of 15
Internally internally-funded projects in
Funded Projects UP Manila, ranging from four
to 165 days from the start
of the pre-procurement process
up to the issuance of the Notice
to Proceed, which is beyond the
156 days maximum number of
days allowed for the
procurement process
6 DepEd Public Private 20,140.03 Setbacks on construction of
Partnership 9,304 classrooms for PSIP I
(PPP) for School and 4,370 classrooms for
Infrastructure PSIP II such as:
361
Program/ Amount
Project (in M PhP)
C5 Program (PSIP) a) lack of validation in
I and II allocation of sites which
reduced the targeted no. of
classrooms from 9,304 to 9,296
for PSIPI; b) delay by one and
a half years in the completion
of classrooms under PSIP I
mostly attributed to incidents
considered as Excusable
Delays in Construction under
Section 12.8b of the contract
agreement; and c) 1,329
classrooms under PSIP II
awaiting completion after
more than two years of project
implementation caused by hard
access/clearing of sites, permits
issues, force majeure,
demolition of existing
buildings, realignment, among
others.
7 C6 PSHS Installation, 514.82 The procurement projects/
Design/Build, activities did not conform with
Construction, the pertinent provisions of the
etc. from 2016 IRR of RA No. 9184
various PSHS
Campuses
8 PTRI Expansion of the 7.72 Non-completion of projects due
Long Staple to failure to undertake initial
Processing Pilot procurement activities.
Plant Area and
Construction of
Silkworm
Rearing House
Technology
Center
9 C7 MMDA Flood Control 337.49 Uncompleted 47, out of 68
Projects programmed flood control
projects for CY 2017, due to
changes in the MMDA
Management and late
scheduling of procurement
activities; program
effectiveness for infrastructure
projects pertaining to drainage
system cannot be readily
evaluated due to non-updating
of CY 2010 inventory of Flood
Control and Drainage
Structures and Related
Facilities
10 DPWH Flood Control 73,351.04 Uncompleted 2,334 projects
Projects, School within the specific contract
Buildings, time; 135 suspended projects;
FMRs, and and 15 terminated projects
Other
Infrastructure
projects
Foreign-assisted 4,837.05 Low disbursement rate due to
infrastructure significant delays which
projects resulted in the incurrence of
commitment fees of PhP27.65
million
11 MVUC 3,973.79 For CYs 2013 to 2016,
program not efficiently and
362
Program/ Amount
Project (in M PhP)
C7 MVUC Program effectively implemented due to:
(i) being carried out by Road
Board Secretariat (RBS) which
lacks technical capability and
not mandated under RA No.
8794 to implement the
infrastructure projects; (ii) the
projects were unnecessarily
split into lamp post civil works
component and the supply and
installation of luminaries
component; and (iii) inadequate
coordination with the LGU
end-users for the maintenance
of the completed projects
resulting in delayed
implementation of the projects,
constructed lamp posts without
luminaires, and non-
replacement of busted/missing
luminaires
Road repair/ 10,205.41 Out of 391 programmed
rehabilitation/ projects for CY 2017: 122
upgrading, road projects still on-going, 78
lighting, road projects have not been started,
safety, and while 106 projects not yet
pollution control implemented/ obligated due to
projects the slow procurement process
and failure to adequately
coordinate with other
government agencies and
public utility corporations at
the early planning stage of
project implementation; also a
total of 121 projects from prior
years were uncompleted or not
yet started
Special Local 17.01 Delayed by one to five years
Road Projects due to late execution of the
under MVUC MOA between the LGUs and
SLRF the DPWH Regional Office 7;
MVUC allotments were
obligated prior to the perfection
of the MOAs, contrary to
Section 46 of PD No.117
12 DOTr DOTr-MRT3 3,759.38 Revenue operations of the
Capacity 48Light Rail Vehicles (LRVs)
Expansion delivered by DALIAN Co.,
(CAPEX) Ltd. delayed for 345 days
Project Lots 1
and 2
Capacity 15,144.33 Intended outcome of
Enhancement of CEMTMMP and CBRTP to
Mass Transit mitigate traffic congestion and
Systems in air pollution in Metro Manila
Metro Manila and Cebu not timely achieved
Project due to delayed project
(CEMTSMMP) implementation caused mainly
and Cebu Bus by the transfer of the
Rapid Transit procurement of Technical
Project Support Consultant (TSC) for
(CBRTP) the CBRTP from the DOTr to
Procurement Service –
Department of Budget and
Management (PS-DBM) and
363
Program/ Amount
Project (in M PhP)
lack of interested bidders for
the CEMTSMMP; delays in
project implementation also
resulted in low
utilization/availment of loan
proceeds and incurrence of
Commitment Fees (CFs)
amounting to PhP90.466
million for CYs 2014 to 2017
13 CAR IFSU Various 157.54 Incurred delays due to
infrastructure continued approval/issuance of
projects suspension orders and
extensions of contract time
even without valid reasons and
justifications
14 ASC 36.01 Delayed six infrastructure
projects
15 BSU 12.07 Slow pace of implementing
projects with appropriations
from Internally Generated
Funds delayed the delivery of
projects to the stakeholders
16 R2 QSU Technology 2.04 Funded by Department of
Promotion and Agriculture-Bureau of
Utilization of Agriculture Research (DA-
Tissue Cultured BAR) did not strictly followed
Banana Project the proposed budget of the
project contrary to the MOA
17 R4-B PSU CO projects 206.77 Failed to implement all the
approved CO projects
18 R8 EVSU Completion of 82.41 Failed to maximize the budget
the EVSU for Capital Outlay due to
Entrepreneur- inadequate planning thus, the
ship Building non-attainment of purposes for
Construction of which the funds were allocated
EVSU
Residencia
19 LNU Various building 87.41 Inadequate planning that led to
constructions, the delayed/non-
58.77
major implementation of identified
improvements, projects thus, possible benefits
rehabilitation from the allocated funds were
etc. not attained
Various building 12.15 Uncompleted infrastructure
constructions, projects within the contract
renovation and period due to non-adoption of
repairs calibrated actions in
consonance with the
Department of Public Works
and Highways (DPWH)
Department Order (DO) No.
193 dated 15 September 2016,
deficiency in undertaking the
detailed engineering, and non-
conformity with the guidelines
in RA No. 9184 on the grant of
contract time extension
20 PIT Various 87.41 Delayed or non-implementation
Building of identified capital outlay
9.31
constructions, projects
renovation and
repairs of tw0-
storey College
364
Program/ Amount
Project (in M PhP)
of Arts and 12.35 Rehabilitation and construction
Sciences (CAS) not completed within the
Building contract period
21 NSU Various 21.45 Non-implementation of some
infrastructure identified projects due to
projects inadequate planning
22 SLSU Construction of 3.50 Significant delay in the project
New implementation/utilization of
Engineering project funds received from the
Building and CHED hindered the intended
Acquisition of beneficiaries of its use
Mechatronic
Technology
(Phase I) PLC
with Robotic
Application
Module under
the Emerging
Sector of
Growth Areas
Program
23 R9 ZCSPC BSIE Comfort 3.25 Infrastructure projects of the
Room College constructed/repaired 1
College Official to 11 years ago were not
Garage recognized as PPE due to lack
Rip-rapped / of documentary support thus,
Lagoon unrecognized depreciation
DME Building expense for the same period;
Secondary and abandoned two projects
Building were no longer fit for use
Sea Wall hence, objectives for the
Fencing projects were not attained
World Food
Trade Building
24 BSC Various 69.16 Uncompleted 10 infrastructure
infrastucture projects within the required
projects contract time or duration
25 R10 CMU Proposed 36.19 Delayed project completion for
College of 354 days from the last day of
Agriculture the revised project duration
Integrated
Science Lab
Infrastructure 28.32 Three infrastructure projects
projects incurred negative slippages
within and beyond the project
duration
26 R11 DNSC Capital Outlay 37.00 For not starting early in the
Projects procurement processes, six CO
projects were awarded to the
lowest calculated and
responsive bidders only in
December 2017 or the last
reporting month of the year
with the Notices to Proceed
released in January of CY 2018
27 R16 NONES Coastal 4.00 Inadequate planning led to the
COST Rehabilitation, wastage of materials in
Enhancement implementing the project which
and Eco- remained uncompleted
Tourism for
Sustainable
Resource
Utilization
TOTAL 134,981.80
365
Program/ Amount
Project (in M PhP)
B. Other Program/Projects
1 C1 NCIP Delineation 1.59 Delayed implementation of the
and delineation and recognition of
Recognition of ancestral land domain title, as
Ancestral provided in the NCIP
Domains and Administrative Order No. 4,
Lands series of 2012 entitled Revised
Omnibus Rules on Delineation
and Recognition of Ancestral
Domains and Lands, deprived
the protection of rights of the
Indigenous Cultural
Communities/Indigenous
Peoples on the possession and
ownership over their ancestral
domains
2 OPAPP PAMANA 932.67 Unreleased funds to the
Program PAMANA beneficiaries due to
non-submission of the required
documents
3 CFO Enhanced 2.68 Failure to fully implement the
Frontline activities for the two projects
Mission planned in CY 2017 like: hiring
Critical of three programmers at the
Systems start of 2017 but only two were
Project; and hired in July and August 2017;
BalinkBayan the systems being developed
Portal were not yet accepted by the
end-users hence, no training
was conducted; regional forum
not held since priority was
given to one-on-one meetings
with targeted 28 Local
Government Units; and lack of
manpower for the whole
4 C4 BJMP Biometric 1.50 Delivery of 184 sets Biometric
Scanner with Scanner with SDK for FY 2017
SDK (Visitor by Pronet Systems Integrated
Management) Network Solution, Inc. with
under the contract price of PhP1.505
Project 3, ISSP million has not yet been
ompleted as of to date contrary
to the provisions of the
procurement contract dated 13
September 2017
5 PA Various 19 106.89 Absence of provision on
projects project timelines in the MOA
by and between DND and
Petron Corporation on the use
of RMC Funds resulted in
delayed project implementation
of 19 projects programmed for
CYs 2015 and 2016
Various 22 1,181.33 Delayed procurement activities
projects under resulting in: 3 projects
PPAs completed, 22 projects awaits
delivery, 5 projects at various
stages of procurement, four
projects' funds transferred to
PITC, and 10 unimplemented
projects
6 PN Establishment 74.77 Referred as “the project”
366
Program/ Amount
Project (in M PhP)
of NCEB of funded by NDRRMF not
the Fleet accomplished within the
Marine targeted completion period due
Detachment, to delayed and/or non-
Rio Hondo and completion of component
Other facilities
Detachments in
Zamboanga
City
7 C5 ECCDC Procurement of 298.28 NCDC contents remained
National Child undelivered by PITC for more
Development than one year from CYs 2014
Center to 2017 depriving the targeted
(NCDC) 600 NCDCs and its
contents beneficiaries
Establishment 38.60 Out of the targeted of 1,100
of NCDCs and community programs to be
Conversion of provided with funding
Existing Day support,only 451 community
Care Centers programs, or 41 percent, was
(DCCs) to accomplished due to: (a) delay
Child in the construction works and
Development in the procurement activities
Centers undertaken by the LGUs, and
(CDCs) (b) unreleased funds to
recipient LGUs amounting to
PhP38.6 million
8 NM National 100.00 Recurring delays in the conduct
Museum of of procurement for the
Natural History infrastructure projects in the
Exhibition and prior years resulted in the
Facilities partial/slow implementation of
Fit-Out and program activities for current
Associated NM year’s rehabilitation/restoration
Complex Site projects which were attributed
Development to the change in location of the
Project project, frequent Variation
NM 100.00 Orders and the dependency of
Anthropology, the works of a project on the
NM Fine Arts completion of another project
and
Planetarium
Building,
Exhibition and
Facilities Fit-
out and
Associated NM
Complex Site
Development
Project
Exhibition and 50.00
Facilities Fit-
out of
New/Moderniz
ed Regional
Branch
Museums
9 PNU PNU Cafeteria 2.63 The operation, including
Operations Institutional Catering and
Regular Catering services, have
no written policy or operational
guidelines nor there were
qualifying and quantitative
367
Program/ Amount
Project (in M PhP)
C5 criteria or parameters that will
serve as guide to carry out the
purpose of its function
10 DepEd Redesigned 386.83 Effective program
Technical- implementation in nine regions
Vocational was hindered by: (a)
High School delayed/non-delivery of
(RTVHS) Technical-Vocational
Program Livelihood (TVL) tools,
materials and equipment, and
(b) underutilized/unutilized
delivered items due to
unreadiness of at least 104
Senior High Schools (SHSs) to
implement the program and
defects in the specifications of
the procured items delivered in
45 schools
11 CHED Research 53.34 Uncompleted 19 projects, out
Projects of 79 projects, implemented by
nine Higher Education
Institutions (HEIs) due to poor
monitoring by the Research
Management Division (RMD)
in assessing the completion
and progress of the projects and
submission of terminal reports
12 DOLE Bottom-up- 929.50 Out of 917 targeted projects,
Budgeting 452 projects remained
(BuB)/Poverty unfinished in 2017 and 32
reduction unimplemented projects in
initiatives of Regions III, IV-A, V and VII
the government due to lack of monitoring and
coordination by the project
focal persons of the Bureau of
Workers with Special Concerns
(BWSC), Bureau of Local
Employment (BLE) and
National Reintegration Center
for OFWs (NRCO)
13 C6 PCHRD Climate 37.77 Planned projects with allocated
Change and budget of PhP40 million in CY
Disaster Risk 2017 not fully implemented
Reduction during the year; the remaining
Program fund balance was used to
augment budget allocations for
other priority programs/projects
14 ICAB Philippine 0.50 Delayed completion
Information
System for
Inter-country
Adoption
(PISICA)
15 NCDA Development 0.63 Only 70 percent of the project
of the NCDA was completed due to delayed
National approval of the Terms of
Disability Data Reference
Collection
System
(NDDCS)
16 ASTI National 21.14 Two projects, covered by the
Government Agency's funds transferred to
Data Center the PITC and the Subic Bay
368
Program/ Amount
Project (in M PhP)
C6 National 21.14 Metropolitan Authority
Government (SBMA) amounting to
Data Center PhP400.901 million not
(NGDC) properly/completely
Projects- implemented despite early
SBMA release of funds due to the
Acquisition of 379.77 absence of timelines and non-
satellite images compliance with the
and requirements of the MOA
installation of
network
connectivity -
PITC
17 DICT Free Wi-Fi 6,507.00 Non-delivery of the desired
Project Free Wi-Fi services internet
connection for the general
public in 1,634 municipalities
and cities nationwide due to the
lack of meticulous and
judicious planning, ineffective
coordination with the LGUs
and the private
suppliers/service providers;
19 awarded contracts under
“Pipol Konek,” previously
named as “Juan Konek” costing
PhP1.236 billion from
March19 awarded contracts
under “Pipol Konek,”
previously named as “Juan
Konek” costing PhP1.236
billion from March 2016 to
October 2017 were either
suspended, delayed, or not
completed within the contract
time thus, may ultimately affect
the timely delivery of the
envisioned 13,024 live sites at
the end of 2017 and the
additional 5,308 sites with a
total PhP6.507 billion budget
from 2015 to 2018
18 JJWC Construction of 40.05 The project, intended to
Bahay-Pag-Asa provide a short-term residential
Project care for children in conflict
with the law, has not been
started since the funds were
transferred in 8 June 2016 and
29 June 2017 to DPWH due to
problems and issues with
concerned LGUs and other
partner-implementers, and
deficiencies in planning,
preparation, and documentation
19 MIRDC Various 615.43 Delays in the completion of
projects various projects due to
inadequate planning and
implementation
20 C7 IA Intramuros 17.55 The project, with total budget
Branding of PhP18 million sourced from
Campaign the fund transfer of Department
Project entitled of Tourism (DOT) in CY 2016,
“Promise & remained unimplemented; only
Posibilities in PhP0.45 million or 2.50 percent
Intramuros" was utilized as at year-end due
369
Program/ Amount
Project (in M PhP)
C7 to late preparation of the
revised project components,
design and concept of materials
to be produced, and required
documents for procurement
process
21 NPDC Paco Park 12.70 Project not implemented as
Conservation scheduled due to delays in
Project carrying out procurement
activities
22 DOT Bottom-up 428.82 Unassured economic viability,
Budgeting sustainability, achievement of
(BuB) Projects desired impact, and efficient
utilization of government funds
for BuB projects
23 C8 DA Philippine 957.68 Uncompleted 12 SPs, out of the
Rural 16 SPs costing PhP1.124
Development billion targeted for completion,
Projects out of the 49 SPs approved for
(PRDP) Sub- implementation during the year
Projects (SPs) costing PhP3.756 billion; only
four SPs completed, and 12
SPs uncompleted costing
PhP957.678 million
24 BFAR Fishing Gear/ 26.40 Delayed procurement and
Paraphernalia distribution/provision of FGPs
(FGPs) and and other fishing materials n
other fishing RFOs III and X depriving
materials various fisherfolk and the
general public of the benefits
that can be derived from the
program
77 Community 224.20 Delayed construction in RFOs
Fish Landing I, V, VI, VII, X and XI
Centers amounting non-utilization of 14
(CFLCs) upright and chest-type freezers
to PhP281.196 million; delayed
turn-over date of
completed CFLCs, non-
utilization of 14 upright and
chest-type freezers
distributedfor CFLCs in RFO
VI, and non-operation of three
units of Custom-Built Air Blast
Freezers with refrigeration
equipment and generator sets
million already distributed in
Region VII
Ring Net 2.89 Delayed implementation in
Project -RFO I BFAR RFO I due to poor
under MFO 5 planning
25 EMB Material 71.63 Non-completion of the MRFs
Recovery and non-utilization of
Facilities shredding machines installed in
(MRFs) existing and non-existing
MRFs hence, objectives of
sorting, segregation,
composting and recycling of
mixed wastes of the LGUs by
EMB-CO, NCR, Regions I,
IV-B, VI, VII and IX were
not full achieved
370
Program/ Amount
Project (in M PhP)
26 CAR IFSU Greenhouse for 0.18 Non-completion of the project
Vegetable hence, deprived the students of
Production the benefits that could have
been derived from said project
Standardization 0.55 Terminated research project by
of Ifugao Rice the funding agency due to non-
Wine for completion of the project
Commercial within the two-year timeframe
Production
27 R6 ASU Research and 0.75 Unimplemented R & D
Development Program entitled
(R &D) "Establishment of a
Program Complementary Food
Production Facility in the
Province of Aklan" funded by
the Department of Science and
Technology VI, under its
Grants-in-Aid (GIA)
28 R16 CHMSC Installation of 4.78 Uncompleted on target dates,
Speech thus students were deprived of
Laboratory the use of upgraded school
Equipment facilities.
projects
TOTAL 13,611.03
Six other agencies were delayed in the implementation of several projects

although the amounts involved were not disclosed in the report:
1 C1 NYC SK Mandatory Non-implementation of the Monitoring of

Training and Roll-Out of Training of Trainers (TOT)
Continuing activity of the SK Mandatory Training and
Education Continuing Education Program for FY 2017
Program due to inadequate planning resulted in the
non-identification of areas for improvement
for the succeeding TOT Roll-Out
2 C5 POEA Repatriation of Increase in requests for repatriation of
Overseas Overseas Filipino Workers (OFWs) since CY
Filipino 2013, reached up to 142.59 percent by CY
2017; Management's actions on requests for
repatriation were also delayed contrary to the
2016 Revised POEA Rules and Regulations
Governing the Recruitment and Employment
of Landbased OFWs
3 C6 PCIEERD Research and Delayed project implementation and various
Development project extensions deprived the government
(R & D) and the targeted beneficiaries from timely
projects realizing the possible benefits from R&D
projects due to inconsistent and inadequate
performance measures/indicator, deficiencies
in project monitoring, delay or non-
submission of necessary documents, and
procurement issues
4 C8 BFAR FishCORAL Delayed implementation of the project with
project low accomplishment rate of only 28.95
percent
Integrated Unimplemented project after almost two years
Marine from approval of the Loan Agreement in CY
Environment 2016
Monitoring
System Project
Phase 2
(PHILO
371
PROJECT
Phase 2
5 R16 NORSU Income Operations of IGPs not fully institutionalize in
Generating accordance with the IGP Manual thereby
Projects (IGPs) affecting their viability
6 PCC PAIWI & Bull Non-implementation of some of the provisions
Loan Programs in the MOA for the PAIWI and Bull Loan
programs may result to wastage of resources
7.4.4.4 The Auditors recommended that concerned officials, among others:
Infrastructure Projects
(a) Accelerate project implementation thru proper scheduling and

planning in consonance with the Annual Procurement Plan. Strictly
follow the time schedule for each procurement activity to ensure
timely project implementation and efficient fund utilization. Closely
coordinate with other government agencies like DPWH.
(b) Identify the lapses in the procurement process of the Agency and
institute mechanisms to address those issues identified to effectively
carry out all the planned activities and projects for the year; and adjust
the implementation schedule of the infrastructure projects,
anticipating the effects of failure of bidding and other related reasons
of delay to expedite implementation of said projects.
(c) For DPWH to: (1) minimize delays in project implementation by

carrying out detailed engineering to ensure that various issues
pertaining to road-right-of-way (RROW), funding, project sites
viability and other stakeholders like LGUs and other
agencies/companies relative to the issuance of permits and clearances,
are properly addressed prior to start of the project; (2) ensure constant
coordination with concerned government/private entities/other
stakeholders; (3) closely monitor the work of the contractors, and
institute necessary remedies such as imposition of liquidated damages
on delayed projects, or termination of projects with negative slippage
of 15 percent or more, (3) initiate immediate take-over process to
complete the projects, (4) disqualify and/or blacklist erring
contractors; and (5) thoroughly review and evaluate the Program of
Work (POW) to minimize variation orders and time extensions.
In the case of foreign funded projects: (a) accelerate the utilization of

loan proceeds by adopting efficient and timely procurement
procedures in accordance with the guidelines of the Foreign Lending
Institutions (FLIs); (b) strictly monitor project status/progress to
ascertain that the strategies adopted are responsive to either fast track
implementation or ensure completion within the given timelines; (c)
prepare the necessary catch up plan/program for the completion of the
projects on the target schedule; and (d) consider including a
stipulation in the contract for the imposition of sanctions against the
concerned contractors for the commitment fees incurred due to their
fault or negligence which should not be borne by the government.
372
(d) On MVUC lighting projects: (1) regularly coordinate with the
ROs/DEOs concerned to ensure that the timing of the procurement
and delivery of luminaires are synchronized with the completion of
the lamp posts; (2) expedite the resumption of the suspended Packages
6 to 9 and the procurement for Package 10 to ensure that adequate
luminaires are available for installation for every constructed lamp
post; and (3) regularly inspect the completed projects within six (6)
months from acceptance to verify if the objective of the program to
provide sufficient road lighting is sustained, among others. Moreover,
stop the practice of RBS implementing projects which is beyond its
mandated functions and the unnecessary splitting of projects if the
same can be implemented by one agency and under one contract.
On road projects undertaken by MVUC, facilitate the completion of

on-going and unimplemented target projects for CY 2017 and prior
years; institute the necessary remedies provided under the Revised
Implementing Rules and Regulations of RA No. 9184; direct the BAC
to properly verify and evaluate during post-qualification the operating
conditions of equipment and other construction requirements, among
others, to ensure adequacy, availability and suitability of the
contractors’ technical capability; immediately inform the concerned
LGUs of their annual SLRF allocation and cause the early execution
of the MOA by both parties; and stop the practice of obligating
allotments without valid contracts/MOAs.
(e) For SUCs, judiciously and promptly plan the infrastructures and
equipment projects taking into consideration the deadlines and
timeframes for the different activities that go with the procurement -
bidding process, BOT approval, lapsing of cash allocation, allotment
validity and disbursements; require the College/University Engineer
to perform regular monitoring and supervision of projects to ensure
that construction works are accomplished in accordance with the
terms of the contract; furnish copies of all requests for time
extensions, suspensions, resumption order and any variation order to
the Office of the Auditor for verification and for the post audit of
transactions; and advise the Bids and Awards Committee (BAC) and
Technical Working Group (TWG) to conduct religiously the standard
procedures of Post-Qualification process as stated in the Revised IRR
of RA No. 9184.
Other Programs/Projects
(f) Review the guidelines in the implementation of projects under the

PAMANA Program to ensure proper planning and programming of
fund releases, and to monitor compliance by concerned IAs with the
submission of the required documents to expedite the release of
project funds.
373
(g) On DepEd’s RTVHS Program, strictly monitor the suppliers’
compliance with the contract stipulations particularly on the
timeliness and completeness of the delivery; in case of delay, impose
liquidated damages to erring suppliers; and instruct concerned
Property Custodians of District Offices and the recipient schools to
report immediately to the ROs the TVL tools, materials and
equipment that were found defective and still covered by the warranty
for the replacement.
(h) On BuB program, DOLE to establish strategic coordination and

monitoring tools in the implementation of the projects such that the
work and financial plans for the given period are carried out in the
regions as scheduled; and simplify implementing rules and
regulations.
(i) On DICT’s Free Wifi Project, fast track the completion of all
suspended contracts and increase the rate of physical performance of
all contracts related to Free Wi-Fi. Coordinate and make
representations with the LGUs and service providers to secure all the
needed documents and to address all other issues on the Free Wi-Fi
contracts to ensure the smooth implementation and completion of the
projects; and Bids and Awards Committee to strictly comply with the
pre-procurement/bidding conference and other applicable provisions
of the RIRR of RA No. 9184.
(j) For BFAR’s 77 CFLCs, follow-up from the LGUs the schedule of
turnover date in order that the fisherfolk beneficiaries will enjoy the
benefits they could derive from the facilities to improve their lives and
livelihood; request LGU-beneficiaries or BFAR to provide
justification for the CFLC site location and for LGU-beneficiaries to
provide a development plan to ensure full utilization of the CFLCs;
and consider offering/transferring the non-operating equipment to
other LGUs who are qualified, capable and interested and closely
monitor its immediate operation and coordinate with the concerned
LGUs for the smooth retrieval and transfer of the equipment, among
others.
7.4.5 Idle/defective/non-operational/not fully utilized projects in 17 NGAs

amounting to PhP3.470 billion from one year to over five years after
acquisition or completion due to various reasons. In three agencies, the
amounts were not quantified.
Program/ No. of Amount

Cluster Agency Remarks
Project Years (in M PhP)
C1 DFA ePassport 2 4.76 Daily capacity of 280
Appointment applicants in the passport
System processing using the two Data
Capturing Machines (DCMs)
not fully maximized resulting
in wastage in slots that could
have been availed by the
374
transacting public and
decrease in the revenue
collections by PhP4.748
million or 15 percent
from CY 2016 to CY 2017
(DFA-RCO Butuan City)
C4 PNP Capability 1 to 2 1,893.30 Non-evaluation of actual
Enhancement years performance of the initial
Program (CEP) 1,656 Mahindra vehicles
bought before buying
additional units resulted in
206 units not being effectively
utilized, out of the total 2,054
units purchased, due to
frequent breakdowns, poor
after sales services and limited
availability of spare parts
impacting on its vision of a
more capable, effective and
credible police force; the
agency also incurred
additional costs of PhP59.379
million in the form of service
fees paid to the PS-DBM
leading to non-attainment of
the objective of the CEP
OSG Network Switch 11 mos. 0.69 Idle and unutilized cabinets
Cabinets for
Information and
Communication
Technology
C5 DOLE Job Search Not 20.46 Only 45 JSKs, out of 138
Kiosks (JSKs) stated JSKs installed in the different
agencies in Metro Manila and
six DOLE ROs, are
serviceable; the other 93 units,
costing PhP20.46 million are
either defective or idle and not
maintained as agreed upon
C6 MIRDC Development of 4 162.94 Three transport research and
Prototype development projects costing
Trainset PhP502.121 million,
Centrally 4 132.19 continuously funded in
Powered Hybrid succeeding years since 2013,
Road Train despite issues on its
Prototype 6 206.99 sustainability; the projects’
Automated output consisting of six train
Guide-Way sets, developed by the agency
Transit System were only used for
demonstration purposes and
remained not adapted by the
government and other
stakeholders due to lack of
viability
C7 DOE Lamp Waste 4 75.33 Failure of the DOE to
Management operationalize the ADB-
Facility funded project, after its
installation and
commissioning in December
2013 due to non-identification
of operator resulted in the
forfeiture of the benefits that
can be derived from reduced
hazardous wastes and wastage
of government funds
375
PCG Generator sets 1 to 2 26.08 17 units of generator sets
remained unutilized since
their delivery in CY 2016 and
kept idle in the headquarters
and various Coast Guard
Districts (CGDs) for more
than a year due to lack of
installation pads and wirings,
and exposing the equipment to
potential obsolescence,
fouling, and scaling
DPWH School buildings 1 352.18 Completed school buildings
and construction and procured construction
equipment equipment not fully utilized
MVUC Overpasses with 1 to 4 35.57 Unutilized Road Safety
manlift elevators Devices in the form of manlift
elevators in overpasses in
Region III due to inadequate
coordination and funding for
its operations depriving the
public, particularly the elderly
and persons with disabilities,
of the use of said facilities
Uninstalled road 2 to 3 3.29 395 road signages procured in
signages 2014 and 2015 remained
uninstalled as at 31 December
2017, 107 of which were not
confirmed by DPWH NCR,
CAR, Region V and IX as
delivered by the contractor
Motor Vehicle 8 437.99 The MVIS facility of LTO
Inspection remained mostly
System (MVIS) unproductive, thus, the
project’s objectives of
improved air quality and
reduced traffic accidents were
not achieved; procurement of
11 sets of MVIS equipment in
CYs 2008 and 2009 made
prior to securing funding for
the complete construction of
the buildings where the MVIS
equipment would be housed
and unresolved
interconnectivity issues with
the Motor Vehicle
Registration System (MVRS)
OTS Security 1 to 2 8.71 SSE purchased by the DOTr
Screening for the OTS not fully utilized
Equipment because several equipment
(SSE) were either defective/
unserviceable or not put in
use, resulting in reduced
airport security for passengers
and their baggage
DOTr Unissued 3 to 9 21.82 85 percent or 76, out of 89
dashboard months units of dashboard camera,
camera and costing PhP6.84 million and
alcohol breath 64 percent or 386, out of 606
analyzer units of alcohol breath
analyzer costing PhP14.977
million remained unissued
and unused as at year-end
since the installation of the
dashboard cameras was not
376
included as one of the
deliverables in the contract
and there is no guidelines
relative to the issuance of
breath analyzers to law
enforcers of other government
agencies
R1 PSU 18 Commercial 4 72.53 Failure to maximize the
Stalls located at utilization of constructed
the ground floor facilities and structures, which
of the Legacy could have contributed to the
Building at PSU overall benefit and the
Lingayen generation of additional
Campus income by the University
Comfort Rooms 1 year
(PSU and 3
Bayambang, months
Asingan,
Lingayen)
2 LED Boards 2
located in PSU months
Lingayen
Campus
R2 QSU Village-Type 2 10.63 Remained non-operational
Corn and idle
Postharvest
Processing
Center at Diffun
and
Maddela
Campuses
R5 SSC Construction of 5 1.27 Project abandoned by the
the Saline contractor
Tilapia
Hatchery, SSC
Magallanes
Campus
R6 ASU 30KVA Not 0.45 Lack of proper planning
generator set stated resulting in non-utilization of
the equipment thus, exposing
the same to risks of damage or
deterioration due to non-
operation, and subsequently,
wastage of government funds.
ISCOF Technical and Not 0.07 Remained uninstalled and
Scientific stated unutilized depriving the
Equipment, students of the College the
Dumangas benefits of upgraded learning
Campus facility, thus, defeating the
purpose of the procurement
made and exposing the same
to possible damage and
deterioration to the
disadvantage of the
government.
R10 NMSCST Automotive 1 year 2.99 Unutilized since its
Laboratory and 1 acquisition on 23 November
Equipment month 2016
TOTAL 3,470.24
In three other agencies, the following projects were reported unutilized or idle
although the amounts involved were not determined.
377
C7 IA Works of Arts 7 Various museum antiques, artifacts and
and collections not displayed/ exhibited but just
Archeological kept idle in the storage rooms of the agency
Specimens since 30 June 2011 in view of the absence of
exhibit areas/places
C8 EMB Shredding Not Non-utilization of shredding machines
machines stated installed in existing and non-existing MRFs
installed in
existing and
non-existing
Material
Recovery
Facilities
(MRFs).
DTI Shared Service Not 395 SSF equipment in CAR and Region I not
Facilities (SSF) stated utilized or partially utilized due to defects
equipment and other conditions identified during
validation
7.4.6 The Auditors recommended that concerned officials to:
7.4.6.1 Review the new ePassport Appointment System at DFA so that system
flaws can be determined and addressed accordingly; find measures to
make it more effective and efficient; and request an increase in slot
allocation according to the demands of passport applicants in Caraga
Region to serve additional clients and increase revenue.
7.4.6.2 Under the Capability Enhancement Program (CEP), conduct

operational needs assessment as part of the agency’s mandatory
activity in strategic planning in order to aid Management in making an
informed decision prior to acquisition of mobility assets or any major
equipment for that matter to prevent the recurrence of the same
problem in the future; engage the services of the PS-DBM only for the
procurement of commonly used office supplies to lessen the payment
of costly service fees especially for major procurements like motor
vehicles; and require all PROs to submit a quarterly status report on all
Mahindra Enforcer and Scorpio vehicles grouping them into the
following categories: serviceable, unserviceable and BER with
evaluation report and recommendations so appropriate remedies can be
undertaken.
7.4.6.3 On DOLE’s Job Search Kiosks (JSKs), conscientiously monitor the use
and proper maintenance of the 93 units of kiosks and address
immediately the requests for repair in various areas; update the data
contained in the kiosks to simultaneously require the PEIS; train and
instruct focal persons on basic proper care and maintenance of kiosk,
fix the defective parts if possible thru the help of the manual, if not,
report immediately to Bureau of Local Employment – Labor Market
Information (BLE-LMI) for proper monitoring; and install in strategic
locations for the benefit of the intended users.
7.4.6.4 Consider redirecting the fund for MIRDC’s three transport research
and development projects to other sustainable/viable research projects
378
relating to the agency’s mandate that will contribute significantly to the
betterment of the country’s metals, engineering, and allied industries
instead of the transport system, to prevent wastage of government
resources. Moreover, projects relating to transport should be
coordinated and consulted with the DOTr and PNR.
7.4.6.5 Regularly coordinate with the DepEd on addressing the viability

of the project/location sites to ensure that the school buildings have
adequate power and water supply prior to project implementation;
verify the proper beneficiaries of the project during the planning stage
to determine its necessity; request additional funding for the
procurement of auxiliary equipment, or return the Road Milling
Machine to the RO for transfer to other DEO which can use the
equipment; and revisit Joint Circular (JC) No. 2013-1 to include the
accountability and responsibility of the LGU being the end-user in the
implementation of program/projects.
7.4.6.6 DOE to fast track the negotiation with the identified LGUs/private
organizations to operate the Lamp Waste Management Facility
(LWMF) in order to serve its purpose and avoid the disallowance in
audit of the said expenditure; and conduct an independent investigation
and hold the concerned officials accountable for the wastage of
government funds.
7.4.6.7 For MVUC, conduct inspection and evaluation of the MVIS equipment
and determine the appropriate course of action or remedies for its
maintenance to recover the investment made by government; request
funding for the completion of the construction of the MVIC buildings,
installation of the MVIS equipment, or replacement of obsolete and
beyond repair equipment; facilitate the resolution of the inter-
connectivity issues with the MVRS; and conduct an investigation to
identify the persons liable for the ineffective implementation of the
MVIS project and file the appropriate legal actions against erring
personnel/ persons, as warranted.
7.4.6.8 Require DOTr’s Property Section and/or Law Enforcement Service to

cause the immediate issuance of the dashboard cameras and alcohol
breath analyzers to respective users; and submit proper documentation
of issuances to Accounting for timely recording in the books.
7.4.6.9 PSU Management to take appropriate action for the installation of

water system and address any other defects or concerns that hinder the
utilization of the said facilities to put into use the constructed facilities
for the benefit of the intended end- users; and IGP Division, to make
proper evaluation as soon as possible relative to the use of the
Commercial Stalls and LED Boards to ensure their smooth operation
and collection of additional income that could be utilized by the
University.
379
7.4.6.10 SUCs to study, plan and effectively operate their facilities and
ensure that these will translate and contribute to the development of the
University’s teaching-learning capability and improvement of the
welfare of its stakeholders; adhere to the provisions of MOA entered
into with different agencies to achieve the purpose of such endeavors
like utilizing the corn processing centers; and if no longer viable, to
effect repossession of the component-facilities of the facility by the
DA-RF 02; or oversee the utilization of farm equipment for income
generating activities and academic purposes.
7.4.7 Unrealized/unrecognized revenue or uncollected/unrecorded income

amounting to PhP15.927 billion in 33 agencies, and in four other agencies
with findings unquantified, primarily due to non-enforcement of
fines/penalties, etc., lack of clear policies, deficient implementation of
contract provisions or operational guidelines, among others, depriving the
national government of additional funds:
Nature of Amount
No. Cluster Agency Reason/s for non-collection
Revenue/Income (in M PhP)
1 C1 MTRCB Registration fees Only 788 operators or 43.34 3.93
percent registered with
MTRCB, out of 1,818 cable
and television operators
granted certificates of
authority, permits and/or
licenses by the National
Telecommunications
Commission (NTC) resulting
in approximately PhP3.93
million to PhP5.84 million
loss in revenues; and 1,030
operators possibly not
monitored as to program
content
2 HLURB Processing fees Under-collection/under- 2.25
assessment due to absence of
specific procedures/review in
HLURB-ENCRFO on the
treatment of
overpayment/underpayment
made by developers in the
2014 approved standard
operating procedure
3 C2 BOC Revenues Lapses in the implementation 6,146.56
of pertinent provisions of the
Customs Modernization and
Tariff Act (CMTA)
Underpayment of taxes, 295.14

duties, and other charges
Rental Income Use of ATI of BOC Bldg. 15.04
space without rent
Lease Rental Non-enforcement of lease 0.47
contract/ unmonitored lease
payments
4 C4 BI Express Lane Non-collection of 869.00
Charges charges/stoppage
5 C5 UPS Miscellaneous Non-enforcement of penalty 0.03
Income- penalty clause of 10 percent per
for late payment month for delayed payment
380
Nature of Amount
C5 of rental fee provided in the Lease
Contracts between the UP
Baguio and four Lessees
resulting in loss of income
6 PNU PNU Income Absence of MOA with the 1.27
Generating PNU Multi-Purpose
Projects (IGPs) Cooperative (PMPC) since
CY 2006; and unremitted
share in the earnings from the
operation of the PMPC
7 TUP Tuition Unrecorded fees/charges 6.38
fees/school paid thru the bank and
charges/interest interest income
income
8 C6 ASTI Income earned Unrecognized receivables and 0.06
thru collection of income earned
receivables
9 ICAB Other Processing Unrecorded collections thru 9.54
Fees, Other bank to bank transfers due to
Service Income delayed issuance of
certification by the BTr
10 C7 TRB Revenue share Uncollected concession fees 44.25
from toll fees from toll operations, which
should be equivalent to 50
percent of fees and charges by
the Service Facility Operators
to Tollway Operators due to
lack of adequate guidelines on
the monitoring, collection and
remittance of revenues
accruing to the government
11 IA Revenue from Under collection and four 6.11
leasing and rental percent decrease in occupancy
of facilities rate, respectively due to non-
attainment of Agency's CY
2017 targets for generation of
revenue from leasing and
rental of facilities and desired
occupancy rate on commercial
properties
12 NPDC Park vending fees Decline in reported revenues 3.93
and entrance/ under the Other Services
admission fees Income account to PhP16.02
million in CY 2017 due to
Agency directives
discontinuing the collection of
vending fees from park
vendors/traders and
entrance/admission fees from
the park’s gated facilities
13 DOE Income earned Uncollected training 820.36
from training commitments and
commitments and developmental assistance
developmental earned from the service
assistance contracts amounting to
PhP429.31 million and
PhP391.05 million,
respectively due to DOE's
failure to require remittance
from its service contractors
14 DOT 50 percent Share Amount of DOT's 50 percent 3.80
in Duty Free share on the DFPC’s Net
Philippines Income for CY 2016 offset
Corporation's against various expenses of
381
Nature of Amount
C7 DOT (DFPC's) Net PhP3.8 million pertaining to
Income (RA No. withdrawal of merchandise
9593) stocks used as promotional
materials and payment for
DOT consultant, which is not
authorized under RA No.
9593; expenses did not
undergo the usual government
procurement process
15 OTS Aviation Security Unrecorded remittances from 27.00
Fees (ASF) CAAP and MIAA of
PhP9.876 million and
PhP17.12 million,
respectively
16 C8 PCAF Loan Repayment/ Nine MOAs without provision 117.37
Collection for the payment of loan; and
17 DA 14 MOAs without indicating 4,376.65
on when payment shall
commence
18 MGB Five percent Not levied against five 2,668.81

royalty mining companies operating
outside the Mineral
Reservation Areas (MRA) in
Region XIII
19 BFAR Fines and Unimposed compromise 9.01
penalties settlement on various
violations under Section 131.2
of the IRR of RA 10654
Rental fees and Non-collection of unpaid 165.99
applicable rentals from delinquent
surcharges Fishpond Lease Agreement
(FLA) holders; and non-
enforcement of provisions of
Fisheries Administrative
Order (FAO) No. 197, series
of 2000
20 CAR BSU Lease of Uncollected Operating lease 4.14
commercial receivables
center Understated Operating Lease 3.79
Receivable account
Low rent amount charged by 0.13
BSU under its lease contract
resulting in the loss of income
21 R1 DMMMSU Receipts/ Recognized as trust liabilities 93.52
collections instead of revenue/income
22 UNP 28.66
23 R3 BASC Collections Unremitted/unreported by 1.74
College canteen and hostel
operation
24 BSU Stalls rental Unaccounted/unrecorded 0.17
income from Sarmiento
Campus due to non-
remittance
25 NEUST Tuition fees Unpaid by students and 6.15
unrecognized as
receivables/income by the
University
26 CLSU Unremitted collections and 7.35
uncollected fees due to
unreported actual number of
enrollees
382
Nature of Amount
27 R4A CSU Tuition Fees Failure to accrue and record 97.48
income from tuition fees for
the 1st Semester of SY 2017-
2018 - Main Campus
-Naic Campus 2.09
28 R4B WPU Receipts/ Fees collected from students 22.62
collections recorded as Trust Liabilities
29 MSCAT instead of Income 46.06
30 R6 ISCF Property rentals Unpaid by lessees operating 0.28
the properties and canteen
business of the College
including utility bills
31 R7 BISU Tuition Already earned but still 4.68
Fees/Other uncollected/ unrecognized in
School Fees the books of Calape Campus
32 R8 LNU School Fees Understatement of income 11.71
account in FC 05
33 R8 NSU Students’ Collections under FC 05 3.23
enhancement recorded as Other Payables
training and year-
end program fees
TOTAL 15,926.75
In other four agencies, there were reported unrealized/unrecognized revenue or

uncollected/unrecorded income but the amounts were not established:
1 C3 COMELEC Not stated Thirty eight official receipt (ORs) in Region
I were missing and/or unaccounted
2 C7 OTC Fees for Non-collection of fees for certificates issued
certificates issued to the participants of seminars/trainings; and
to the participants Management failed to submit the number of
of seminars/ trainings/seminars conducted and the
trainings corresponding amount collected by
Employees Development Cooperative
(EMDECO) for the issued certificates.
3 C7 DOTr Income earned Potential income to be earned from lease of
from lease of condominium units owned by the
properties Department in The Columbia Tower in
Ortigas Avenue, Mandaluyong City had there
been a structured transfer plan prepared prior
to DOTr's relocation to its new office in
Clark Economic Freeport Zone, Clark Field,
Angeles City, Pampanga
Income from Potential income to be derived from 11,695
disposal of impounded motor vehicles (IMVs) at LTO
Impounded Offices; absence of policy and procedures on
Motor Vehicles the disposition of said vehicles
4 R10 MSU- Income from Income from the dormitory not properly
LNAC dormitories recorded and remitted to the cashier
7.4.8 The Auditors recommended that concerned officials to:
7.4.8.1 Strictly enforce/implement existing operational guidelines and

contract provisions and consistently collect the required fees,
fines, penalties, receivables, among others, to in order to safeguard
government interest and augment its coffers.
7.4.8.2 For BOC, to: (a) enforce settlement of bonds, and monitor the
payment/liquidation or cancellation of bond and strictly adhere to the
383
provision of Customs Memorandum Order (CMO) No. 16-99;
(b) enforce collection from importers of their unpaid/unsettled accounts
and to impose penalties and surcharges, and other legal actions on
delinquent importers; (c) initiate legal actions against the owner or the
salvaging company for dismantling the subject vessel without securing
the proper clearance from the BOC; and (d) investigate the release of
the seized and declared abandoned 40,000 bags of Vietnamese Long
Grain White Rice. Henceforth, ensure that seizure/forfeiture
proceedings are immediately initiated and enforced, and file appropriate
charges against persons liable, if warranted; issue a demand letter to the
BFP and its supplier Kolonwel and Hubei for the payment of additional
PhP295.140 million of duties and taxes, plus penalties.
7.4.8.3 Submit an explanation/justification for non-compliance with the

President's veto message on the recognition of BI’s collections from
express lane charges as income of the General fund.
7.4.8.4 Immediately require DOE’s service contractors to remit their contractual

obligations as they become due. Revisit the provisions of the service
contracts and make the necessary amendments to require the provision
of developmental assistance in cash instead of in-kind.
7.4.8.5 DOTr, to provide the Audit Team its action plan and timelines in the
lease out of the owned units in the Columbia Tower to recompense the
projected increase in annual expenditures of the National Government;
and facilitate the immediate leasing out of unoccupied units. In the case
of disposal of impounded motor vehicles (IMVs), secure authority from
the Office of the President as well as strengthen Department Order No.
2018-009 issued by DOTr on the disposal by LTFRB of unclaimed
IMVs deemed abandoned by owners to prevent accumulation of the
same and incurrence of unnecessary expenses;
facilitate the issuance of guidelines on the recording, maintenance,
handling, monitoring, storing, custody, accountability, safekeeping,
disposal and reporting requirements for IMVs; hasten the disposal
of the IMVs in accordance with pertinent regulations to prevent further
deterioration, pilferages and loss of economic value; ensure the
exclusivity of the lot being leased as impounding area by LTO Region I
and designate person accountable to secure the IMVs; and conduct
investigation on the undocumented MVs/MCs, and establish the liability
of the persons tasked to account for them.
7.4.8.6 PCAF to revisit the MOA and determine whether the release of funds
was actually grants or loans and cause its reformation, if necessary; and
enforce the provision on the repayment of loans by coordinating with
the proponents and/or sending demand letters.
7.4.8.7 Exert effort and provide measures in efficiently collecting the loan
proceeds from various proponents of DA; and require the implementing
agencies (IAs) to liquidate the long outstanding balances from ACEF
and/or refund the unused balance to DA.
384
7.4.8.8 For BFAR, require the Heads of RFOs, particularly I, IV-A, VI and X,
among others, to exert extra efforts to collect the unpaid rentals from
delinquent FLA holders by sending demand letters for payment of back
rentals and surcharges; conduct regular monitoring of active FLAs and
remind/notify them of FLA expiration and/or renewal of their
agreement; strictly implement the cancellation or termination of unpaid
FLAs for two consecutive years and to file appropriate action/s to
collect these receivables; renew the contract of those fishpond holders
who have been continuously paying rentals despite their expired
contracts; and submit endorsement for the cancellation of the FLA to
the DA Secretary if there was a prima facie evidence that the terms and
conditions of the FLA are violated. Moreover, strictly impose the
compromise settlement on various violations under the IRR of RA No.
10654.
7.4.9 Reported dormant/idle/unutilized funds, unauthorized bank accounts/

deposits, or collected income/revenue amounting to PhP8.456 billion in 48
agencies still unremitted to the Bureau of the Treasury (BTr) or
unreturned to the Source Agencies (SAs) contrary to pertinent laws, rules,
regulations, and Supreme Court decisions depriving government of more
funds for its programs/projects.
Nature of Amount
No. Cluster Agency Reason/s
Funds/Deposits (in M PhP)
A. Unutilized project/program funds or dormant/idle balances unreverted to BTr
1 C1 NCIP Cash-in-Bank- Remained unutilized for more 7.82
Local Currency than two years due to unresolved
Current Account boundary conflicts between
(CIB-LCCA) Tuba, Benguet and Sison,
Pangasinan (PhP5.54M) and
failure to implement project in
RO II (PhP2.28M)
2 PSC Interest income Management believed that the 2.67
from bank interest income formed part of
deposits the National Sports
Development Fund (NSDF)
3 NAP Fund Transfer Completion of digitization of 1.24
(FT) balances documents and conversion of
for completed/ microfilms to digital image will
unimplemented no longer be pursued due to
projects and problems in procuring a service
dormant trust provider
fund
4 NAPC FTs from other Maintained in separate current 101.14
NGAs plus accounts at the LBP without
interest earned authority.
5 C2 BOC CIB balances Non-remittance of unutilized 96.35
idle funds from general and
trusts fund maintained in the
banks
6 PSA Balances from Not stated 2.40
completed
projects
including
proceeds from
sale of bid docs
385
Nature of Amount
C2 in Regions III
and IX
7 NEDA Refunds of cash Concealment of non-remittance 0.53
advances of cash advance refunds; there
were alterations of deposit slips
to make it appear that
remittances were made
8 PMO Interest income Provisions in the Contract of 0.24
from time Lease and Deed of Sale
deposits pertaining to the return of
interests earned on the
refundable deposits contrary to
Section 65, PD No. 1445
9 DOF Unutilized Not stated 56.09
special-purpose
funds and
proceeds from
sale of bid docs
10 BIR CIB-LCSA Maintained as depository 3.22
(Payroll) and account for payroll transactions
LCCA (RO3)
balances
11 C4 PA Interest income Details not yet identified at year- 1.18
end hence, unremitted to the BTr
12 DOJ Bank account Absence of authority from the 13.10
balances not Permanent Committee contrary
authorized to be to Section 4, FY 2017 GAA
deposited with
AGDB
13 C5 DepEd CIB-LCCA Maintained without specific 90.18
(Trust authority/ legal basis; or are
Accounts) being used for the unauthorized
retention of various
receipts/income
14 UPS Disbursement Unutilized DAP funds received 32.37
Acceleration from CHED comprising of the
Program Fund unspent balance from the UPSA
(DAP) managed projects amounting to
PhP14.32 million and balance of
PhP18.05 million returned by
the seven UP campuses not yet
remitted to the BTr or refunded
to CHED
15 C5 PNU Regular Agency Unutilized Cash, Modified 5.35
Fund Disbursement System (MDS),
Regular without specific
purpose and not yet reverted to
the BTr
16 PUP PUP Angara Dormant PNB bank accounts 7.15
Perpetual transferred/ deposited to the PUP
Scholarship, Regular Trust Fund account
Ninoy Aquino maintained at LBP without
Checking proper documentation
Account,
Scholarship
Fund-
Professional,
Mohler
Scholarship,
Villareal and
Emilio Yap
Manila Bulletin
Professor
386
Nature of Amount
17 C5 DOLE CIB-LCCA Deposits in various banks not 418.67
remitted back to the BTr, in
violation of RA No. 10924 and
EO No. 338 dated 17 May
1996
18 C6 PSHS Trust Receipts Non-remittance to the BTr of 0.55
collections consisting of bidders
bond, payments for lost books,
excess funds for production of
yearbook, and excess of
donations from various sources
for the repair of campus
facilities, purchase of equipment
and funding for campus
activities
19 SEI Refunds of Deposits made directly by 5.42
financial scholars to the Agency's bank
assistance from account for refund of scholarship
defaulting benefits
scholars
20 CWC Petty Cash Fund Balance of the cash 0.12
(PCF) accountability of the former PCF
Custodian turned-over to the
newly designated PCF
Custodian
21 DOST Scholarship Non-remittance of the unspent 17.85
Fund scholarship funds by DOST RO
VI to the SEI as the source
agency
FT for Central Unexpended balance of 0.13
Visayas CVCIERD Project funded by
Consortium for PCIEERD remained in the books
INdustry and of DOST Region VII
Energy
Research and
Development
(CVCIERD)
project
22 C7 NPDC FTs from DOT, Unused cash balances from fund 0.43
DOLE and transfers/financial assistance
TIEZA received by NPDC from DOT,
DOLE and TIEZA not returned
to SAs despite the completion
projects/ activities
23 MMDA Inactive trust Account for trust fund 10.34
fund account transactions inactive for four
years but not reverted to the
General Fund
24 DOT Interest Income Interest Income, Participation 1.70
& other funds Fees, Accreditation Fees,
Chamber Treatment Fees,
Registration Fees, Seminar Fees,
Bidders/Performance Bond and
Sale of Scrap Materials not
remitted to the BTr or returned
to SAs
FTs from Unexpended balances from 38.49
various SAs funds received from various
source agencies not returned or
refunded by DOT
25 DPWH Bank accounts Dormant and unnecessary bank 37.01
maintained for accounts amounting to PhP3.59
funds of various million, interest income and
completed excess proceeds and other
387
Nature of Amount
C7 projects and collections of PhP33.42 million
collections from not remitted to the BTr
bid documents,
conference fees,
guaranty
deposits and
other trust
receipts, fund
transfers, and
refunds of audit
disallowances
26 DOTr Bank accounts, Dormant and unnecessary Cash 66.74
Cash-Treasury accounts such as CIB-LCCA
Deposit, Trust account for Digitel and Cash-
accounts Treasury Deposit, Trust accounts
for LRF, bidders bonds, LRT II
Projects, and MRT 7 PMO Fund
remained unreverted to the
General Fund
27 CAR IFSU FTs Unexpended balance of funds 1.19
transferred by DICT due to non-
preparation of liquidation reports
28 R1 PSU CIB balances Unused cash-in-bank balances 13.70
due to continued transfer of cash
support to various campuses
through funding checks
deposited in their respective
current accounts
29 R2 BSC CIB-LCSA Unutilized balances of NCAs 36.13
under Cash – Modified
Disbursement System (MDS),
Special Account transferred to
Cash in Bank, Local Currency,
Savings Account under Fund 05
to avoid lapses of NCA
30 CSU Bank deposits Various current and time deposit 1.52
accounts dormant and unutilized
for years
31 R2 ISU PNB Account- Intended for land expropriation 0.33
Trust Fund
(Time Deposit)
32 QSU Special and Grantees or scholars of both 1.65
Trust funds scholarship programs have
graduated
33 R4-B PSU Inter-agency No close coordination between 13.36
transferred the Agency (Accounting) and
funds/Due to project implementer hence,
NGAs unaware that project was already
completed
34 R5 BU LBP Account - Dormant for three years 76.83
Time Deposit
Account
Bank Accounts Dormant 0.89
Trust Account Dormant, unexpended CY 2013 8.32
Specific Budget transferred to
Trust Account in CY 2014
35 R8 VSU Excess Not stated 5.26
scholarship
funds
36 EVSU SAPSUC Six dormant accounts as defined 0.80
(LBP)-Trust under Joint Circular No. 4-2012,
Receipts for the dated 11 September 2012
Student issued by DOF, DBM and COA
Assistance Permanent Committee; also
388
Nature of Amount
Program of include two bank accounts under
SUCs the Regular Agency Fund (RAF)
DICT (LBP)- with expired validity 6.48
implementation
of various
programs
37 R9 JRMSU- CIB balance Dormant for over two years 0.10
Katipunan
38 R10 MSU-IIT Checking Trust Fund Accounts balances 5.01
Accounts (CAs) that remained non-moving for
five consecutive years or more;
other unnecessary accounts with
unutilized balance for some
completed Programs/ Projects
which are not remitted to their
respective funding agency and
remained in the books for one
year or more; and three CAs
maintained within 112 Trust
Fund Accounts
Sub-TOTAL 1,190.05
B. Income/Revenue Collections unreverted to the BTr
C2 BOC 20 per cent BOC-POM continuously set 43.42
share from sale aside 20 percent from sale of
abandoned and ipso facto
forfeiture goods for Informer’s
Reward share
39 PSRTI Excess Income- Not stated 0.74
Training fees
40 C3 COMELEC Income Collected by LGU on behalf of 0.26
COMELEC, Region 3 remained
unremitted
41 C4 VMMC Sale of Proceeds retained by the Agency 1.09
unserviceable and deposited under Use-of-
vehicles, Income (UDI) fund
disposal of
records, slops
and other waste
materials, and
penalties
charged due to
loss of various
x-ray films,
liquidated
damages
42 NAPOLCOM Rental fees from Transferred to NAPOLCOM 4.68
lease of the Provident fund instead of
building's wall- depositing to the BTr account
space
43 C5 PRC Oath-taking fees Collections and disbursements 36.29
handled by Professional
Regulatory Boards (PRBs)
instead of PRC
44 C6 ITDI Training Unexpended balance needed to 1.60
Fees/Sale of Bid pay obligations with Purchase
Documents Orders awaiting deliveries;
excess collections from sale of
bid docs will be remitted as soon
as payment of unpaid obligations
were made
45 C7 DOE Trust accounts DOE opined that what is 7,176.46
for the contemplated by the GAA refers
collections of only to purely public funds.
389
Nature of Amount
C7 financial Funds remitted to the DOE
benefits to host exclusively for the benefit of the
communities host communities was never
amounting to owned by the Department thus,
one centavo per should not be remitted to the
kilowatt-hour of BTr
the total
electricity sales
from the
Generation
Facilities
/Companies
and/or energy
resource
developers
NPDC Various Collections from the use of park 0.58
collections service amenities, cash bonds,
and bid documents not remitted
to the BTr
46 CAR KSU Fees/sale of bid Collections recorded under 0.12
47 MSPC documents Other Service Income account 0.12
and not remitted to the BTr
R2 CSU Sale of bid Not stated 0.19
documents and
fees from
contractor/
supplier registry
48 R3 CLSU Sale of bid Unexpended balances not 0.82
documents remitted to the BTr
Sub-TOTAL 7,266.37
GRAND TOTAL 8,456.42
7.4.10 The Auditors recommended to Management to close all unauthorized

bank accounts including the the High Yield Savings Accounts or Time
Deposits, and immediately remit to the BTr or return to the SAs the unutilized
fund balances in compliance with pertinent laws, rules and regulations such as
EO Nos. 338 and 431, COA Circular No. 2015-001 dated 29 January 2015,
Section 11, General Provisions of the GAA for FY 2017 and DBM-DepEd
Joint Circular No. 2004-01, among others.
For SUCs, to ensure strict compliance with DBM NBC Nos. 488 and 567 as
well as COA GAFMIS CL No. 2003-004 on the transfer of funds and
accounting of funds released by the DBM; discontinue the scheme of fund
transfers through funding checks; remit the unutilized/unexpended balance of
the MDS account of the campuses to the BTr; and submit to the Audit Team
copy of the JEVs to support the compliance.
7.4.11 Funds/properties in seven agencies were reported to be utilized for

purposes other than the intended purposes of the program/project
defeating the reasons for which these assets were created.
390
Project/ Amount
Cluster Agency Purpose Remarks
Program (in M PhP)
C6 TAPI Inventors Extending Use of the IGF has 189.55
Guarantee financial loan not been maximized
Fund (IGF) assistance for for its main purpose
patented Filipino
inventions
PCHRD TECHNICOM Establishment of Council did not 2.75
Institut Pasteur appropriately utilize
(IP) Phils.; the trust funds
Discovery and received from various
Development of SAs whereby: (a)
Health Product disbursements of
Program; HSRM PhP26.19 million were
2015; National TB incurred for three
Prevalence Survey projects though actual
Projects; EIDR funds were not yet
Program (Projects received from the SAs;
1 and 2); and (b)
ASTHRDP inappropriate expenses
Scholarship Grant: amounting to PhP2.75
UP's Emerging million were charged
Interdisciplinary to program/ project
Research; EIDR; indirect cost funds,
etc. contrary to the
intended purpose
stated in the MOA
PCIEERD Bridging the Train Grade 1 The policy created and 96.00
Human public school various projects
Resource teachers in the use implemented by
Competency of the Interactive PCIEERD under the
Gaps in Grade 1 BCDA Fund were not
Support of Mathematics in accordance with the
the National Courseware; provisions of RA No.
Research Level up their 7917, thereby
and capabilities deviating from the
Developmen through intended purpose of
t Agenda benchmarking the fund
(BCDA) activities in
various countries;
and Develop and
enhance Filipino
R&D capabilities
through upgraded
human resources,
among others
CAR MPSPC Income To be utilized for IGP Fund was utilized 1.12
Generating instruction, for employee benefits
Projects research, and incentives and not
(IGP) Fund extension, or other for instruction,
programs/projects research, extension, or
of the College other
programs/projects of
the College
R3 TAU Funds Not stated Disbursed for purposes 4.56
other than those duly
authorized which is
not in accordance with
the Unified Accounts
Code Structure
(UACS) Manual and
the Fundamental
Principles for Revenue
and Disbursement of
Public Funds
R9 JRMSU University Quarters privileges A total of 90 Not stated
housing employees of
391
Project/ Amount
Cluster Agency Purpose Remarks
Program (in M PhP)
facilities Katipunan and
Tampilisan Campus
who are not entitled to
quarters privileges
were allowed to use
University housing
facilities without
paying the cost of
rentals and of which
22 occupants already
retired on their
service; likewise, 207
settlers who are not
employees occupy
Tampilisan Campus
premise without prior
approval of the Board
R16 CPSU Government Intended primarily Lack of authority and Not stated
lot or agricultural written policies as
school purposes well as the absence of
MOA between the
CPSU and the lot
occupants resulted to
unauthorized use of
more than 12.767
hectares of
government property,
thus the interest of the
government is not
adequately protected
which may subject
these properties to
prolonged use or
abuse.
7.4.12 The Auditors recommended that concerned officials use the funds for intended
purpose/s only and maximize its utilization to attain the purpose for which
these funds/properties were created; and ensure that government assets are
fully protected/safeguarded.
7.4.13 Unattained plans and targets or unrealized program/project objectives

in 41 NGAs and SUCs for various reasons which affected or delayed the
delivery of needed services to identified clientele/beneficiaries.
Project/Program
Amount
No. Cluster Agency Target or Remarks
(in M PhP)
Objectives
1 C1 GCG GCG Employee Expected project deliverables 2.14
Association (GCG- intended for the employees’
EA) Fund Project improved working conditions
not achieved due to absence of
monitoring in the utilization and
liquidation of transferred funds
to GCG-EA
2 HLURB Land Use A total of 84 cases or 72.41 Not stated
Adjudication percent unresolved as of 31
Program December 2017 hence, non-
attainment of the Agency’s
target on adjudication of REM
392
Project/Program
Amount
(in M PhP)
Objectives
C1 and HOA cases in HLURB-
SMRFO
Various Projects HLURB-ENCRFO failed to Not stated
inspect and monitor 23, out of
182 projects, within the six-
month period from the issuance
of the LS resulting in non-
imposition of sanctions/
fines/penalties defined under the
2004 Schedule of Fines and
Guidelines for Its Imposition on
violations or deficiencies of
erring developers, if any
3 DFA ATN/services Program of activity for ATN, Not stated
particularly for the 19 detainees,
not fully accomplished/ attained
in CY 2015 and 2016 due to
failure to request permission and
time in the scheduling of visit
(PE, Tel Aviv, Israel)
ATN services status
report/matrix lacked information
on the progress of the case and
timelines/timeframe thus, the
Post’s performance efficiency
and timely service rendition was
not properly evaluated (PCG,
Vancouver)
ATN - Migrant Lack of standby ATN Fund Not stated
Workers and affected the efficient and
Overseas Filipinos effective delivery of needed
Act of 1995 assistance to nationals thus,
defeated the Migrant Workers
and Overseas Filipinos Act of
1995 objective to protect the
rights and extend immediate
assistance to distressed overseas
Filipinos (PE, Wellington)
LAF Timely and immediate hiring of Not stated
competent private counsel and
court translator to protect and
defend distressed Overseas
Workers affected by delayed
request of the Post to utilize the
LAF (PE, Jakarta, Indonesia)
Overseas Absentee The Post obtained an average Not stated
Voting System performance rate of 75 percent
(OAVS) on the registration of Overseas
Filipinos as of September 2017;
also noted a low-turn-out of
registered voters in the 2016
National Election (PM-Geneva,
PGG-Milan and Agana, PE-
Ankara
4 C2 BOC Collection Targets A decreasing trend in the 8,122.00
collection performance for the
three-year period from 2015 to
2017 vis-à-vis collection targets,
with shortfall, from PhP69.685
billion or 16 per cent in 2015, to
PhP8.122 billion or 1.70 percent
in 2017 despite the increased
targets every year
393
Project/Program
Amount
(in M PhP)
Objectives
Disposal of Undisposed overstaying Not stated
abandoned, seized abandoned/ seized/forfeited
and forfeited goods goods exposed the items to risk
of loss through pilferage/theft,
and spoilage/ deterioration
which could tantamount to loss
of revenue
Auction Sale Lowest auction sales in CY 2017
for MICP, compared to the last
four years, due to slow
disposition of overstayed
containers
5 C4 PA 10 Buildings and Unattained goal to have 10 350.47
medical dispensary buildings and medical
dispensary in TRADOC to
accommodate the enlisted
personnel, students and officers
by end of June 2013 with
allocated amount ofPhP325.47
million and PhP25 million,
respectively
6 C5 DepEd DepEd Only 436 received delivery of 2,059.94
Computerization Information and
Program (DCP) Communications Technology
(ICT) packages, out of 78,140
targeted ICT school recipients
under the DCP for CYs 2015-
2017, or an overall 99 percent
deficiency vis-a-vis expected
physical target, or at least 77,704
schools still awaiting for ICT
learning equipment; of the
PhP9.9 billion awarded
contracts, five contracts were
perfected in December 2017 and
one was perfected only in
January 2018 hence, delivery of
items is expected to be
completed in July and August
2018
School Furniture Unattained desired outcome of Not stated
Program (SFP) addressing furniture needs of
schools in seven regions due to:
a) delay in downloading of funds
by the DepEd CO and execution
of procurement activities; b)
delayed deliveries of at least
70,124 pieces of armchairs and
2,242 sets of teachers’ tables
and chairs; c) non-utilization of
19,493 pieces of armchairs and
286 sets of teachers’ tables and
chairs due to, among others,
delayed completion of the school
buildings, oversupply of
furniture and poor workmanship/
inferior materials used resulting
in 3,049 and 54 damaged/broken
armchairs and teachers’ tables
and chairs, respectively; and d)
deliveries/transfers to non-
recipient schools of excess
4,962 pieces of armchairs and 85
394
Project/Program
Amount
(in M PhP)
Objectives
C5 sets of teachers’ tables and
chairs due to lack of
coordination between DepEd
and LGUs
7 PNU CHED K to 12 Not satisfactorily completed due 60.00
Engagement to delayed implementation by
Program Management of the program
timelines ranging from 90 to 450
days resulting in the
discontinuance of the 2nd and
3rd Phases of the Program
8 CHED Philippine Only 190 scholars were awarded 5,052.00
California scholarship grants, out of 500
Advanced targeted scholars, equivalent to
Research Institute 38 percent; developed five, out
(PCARI) of the 10 planned programs and
scholarship curricula or 50 percent;
grants/planned completed only six research
programs/ research projects, out of the 15 projects
projects under Cycles 1 and 2 which are
supposed to have been
completed as of 31 December
2017; and delayed execution of
project activities by nine months
9 DOLE Institutionalization Only 40 additional PESOs were 1.12
of Public institutionalized during the year,
Employment thereby, information related to
Service Offices employment opportunities of
(PESOs) jobseekers, livelihood prospects
of women and income
augmentation of the
underemployed were not
extended to the 1,431 PESOs not
institutionalized pursuant to RA
No. 10691, as amended
10 NCMB Single- Entry Only 3,923 requests for Not stated
Approach to assistance (RFAs), or 61.52
conciliation- percent, were settled, out
mediation of6,377 RFAs handled under the
Single-Entry Approach (SEnA),
within the 30-day mandatory
conciliation-mediation period
over labor disputes prior to
compulsory arbitration thus,
judicious and speedy settlement
of labor issues or conflicts have
not been strictly accomplished
Voluntary Delayed settlement of cases as Not stated
Arbitration 312 cases, out of 646 total cases
Program (VAP) handled, were resolved beyond
the Process Cycle Time (PCT)
of 90 days, while 237 cases
remained unresolved as of year-
end
11 UPS Research Projects Non-attainment of complete and Not stated
(RPs) timely evaluation of researches
due to inadequate monitoring,
maintenance of RPs’ records by
the concerned offices,
insufficient compliance by the
Project Leaders (PLs) with the
terms and conditions of the
MOA/Contracts, and other
395
Project/Program
Amount
(in M PhP)
Objectives
C5 UPS lapses in RP implementation in
UP Diliman UP Visayas and UP
Mindanao resulting in: (a) 36
or 69 percent of the 52
externally-funded completed
RPs have no available record
such as MOA, Progress Report,
etc.; (b) 65 or 33 percent of the
197 internally/externally-funded
RPs are not supported with
Progress/Final Technical Report
(P/FTR); (c) 45 or 34 percent
of the 132 completed RPs with
FTRs have no Fund Utilization/
Terminal Financial Report
(TFR) at the end of each grant,
while the 87 RPs with TFR were
only approved/signed by the
concerned grantees but not
certified by the Accountant as
required in the MOA, among
other
Medical MAP intended for eligible 7.34
Assistance indigent and poor patients but
Program (MAP) - lapses in the implementation
Philippine General include availment of medical
Hospital (PGH) benefits by 144 Pay In-Patients,
ranging from PhP3,016.40 to
PhP609,726.40
12 C6 DOST RxBox Telehealth Uncompleted roll-out of 1,000 169.27
Device RxBox Telehealth Devices in
selected Rural Health Units in
DOST RO IV-A as per target
date
13 NTC Collection Targets Unattained collection targets for 3.19
CY 2017 by NTC RO VI
million, short by PhP3.188
million or three percent
14 NAST Locally-funded Three objectives, out of the four 7.70
Project entitled, objectives of the locally-funded
"Strategic project, unattained such as
Response to the advocate and promote the
S&T Concerns of a resulting draft resolutions and
Progressive recommendations of RTDs,
Philippines Publish monographs/
Anchored on proceedings/papers on selected
Science" topics, and maintain updated
information in the NAST
website despite utilization of
98.77 percent of its fund
allocation of PhP7.70 million;
undelivered one output, out of
eight outputs expected in CY
2017
15 DOST Sustained Website reporting not fully 25.40
Nationwide attained; an average of only 74
Dengue Vector percent of the total national
Surveillance schools were regularly reporting
(NDVS) -DOST to the NDVS website
NCRO
396
Project/Program
Amount
(in M PhP)
Objectives
16 C6 ASTI 2 Major Final Uncompleted/unimplemented 157.20
Outputs (MFOs) four projects or 25 percent, out
of the 16 projects slated for
completion in CY 2017 under
the two MFOs of the Agency, 325.78
owing to shortage of staff,
delays in procurement and
design revisions
17 PAGASA 12 locally-funded Failure to specify the project 647.19
projects schedules and required
submission of approved Annual
Work Plan for the 12 projects
indicated poor and unrealistic
planning for the project thus,
attainment of accomplishments/
outputs were not properly
described
18 C7 DOTr Driver’s License Delayed procurement and 345.44
(DLs), Validation delivery of items resulted in
Stickers (VSs) and unissued: 2,498,144 DLs,
Plate Year Tags 1,216,569 VSs, and Costs
(PYTs) cannot be
1,506,116 PYTs to respective
applicants affecting the effective determined
and satisfactory delivery of
service to the clientele
Processing of 23,960 unacted applications for Not stated
applications for franchises as of 31 December
franchises 2017 due to delayed processing
of applications in LTFRB CO,
NCR, Region V and DOTr
CARAGA by one (1) to 1,091
working days contrary to the
standard processing time of 15
to 66.5 working days
Acceptance, The following observations Not stated
processing and showed the non-attainment of
approval of objectives of specific governing
applications for Memorandum Circulars (MCs)
franchises/ formulated and issued by the
Certificate of Board: (a) Franchise of
Public the 3,266 Motor Vehicles “For
Convenience Hire” were confirmed without
(CPC) prior registration with LTO; (b)
Applications for Extension of
Validity of expired CPCs of 13
units Utility Vehicles (UV) were
accepted; (c) Motion to Allow
Re-Instatement of the original
number of units were approved
despite lapse of time given in the
original decision; (d) CPCs were
approved despite incomplete
documentary requirements; and
(e) registration of Tourist
Transport Services were
confirmed without Department
of Tourism (DOT) Accreditation
19 C8 MGB Major Final Ouput MGB has accomplished its 2.43
2 (MFO2) – targets except for Regions VIII
Mining Regulation and IX for Major Final Output 2
Services (MRS) (MFO2) – Mining Regulation
Services (MRS) which
corresponds to their fund
397
Project/Program
Amount
(in M PhP)
Objectives
C8 utilization of PhP257.62 million
or 99.07 percent of allotment of
PhP260.05 million for CY 2017
20 DAR Agrarian reform Targeted activities were less Not stated
cases and compared to its existing
adjudication of caseloads and beginning
agrarian law balances thus, the objective of
implementation DAR to resolve the cases in a
cases speedy, judicious and
inexpensive manner was not
achieved
21 PRRC Six Performance Unachieved targets with 1.38
Indicators (PIs) for percentage of accomplishments
its Major Final ranging from 35.80 to 75.84
Outputs (MFOs)-1 percent for CY 2017 and fund
utilization of PhP9.739 million
or 87.56 percent of the total
allotment of PhP11.123 million
Locally Funded Commitment to deliver 2,558 8.47
Projects-Flood linear meters under the projects
Control and was not met having an
Drainage accomplishment of only
1,931.40 linear meters or 75.50
percent of the 2,558 linear
meters of the targeted length
with utilized fund of PhP68.010
million or 89 percent of total
allotment of PhP76.484 million
22 ACPC Major Final Output Unachieved target of 90,920 -
(MFO) 1 - Credit loans beneficiaries, short by two
Support Services percent or 2,129 loans
Targets beneficiaries
23 CIAP Construction Only four or 67 percent of the -
industry policies six policies were issued within
for CY 2017 the prescribed period to the
appropriate
agencies/stakeholders thus, the
80 percent targeted in CY 2017
was not achieved
24 IPOPHL Target of eight Failed to organize exhibits 38.46
exhibits organized during the year, thus, unable to
meet its target of eight exhibits
organized; but the agency
participated in 15 various trade
fairs and exhibits spearheaded
by other agencies and private
entities to build public
awareness on Intellectual
Property (IP)
25 NWRB 13 Performance Achieved 11, out of 13 4.85
Indicators (PIs) for Performance Indicators (PIs) for
two Major Final two Major Final Outputs
Outputs (MFOs) (MFOs) for CY 2017, with fund
for CY 2017 utilization of PhP88.208 million
or 94.79 percent of the total
budget of PhP93.060 million;
target of 20 percent of water
permit holders incurring one or
more violations in the last three
years has more than doubled
26 PCAF Six targeted Fell short by four percent for one 4.10
activities for its targeted activity. out six targeted
Major Final Output activities for its Major Final
398
Project/Program
Amount
(in M PhP)
Objectives
C8 1 (MFO1) – Output 1 (MFO1) – Agriculture
Agriculture and and Fishery Policy Services for
Fishery Policy CY 2017, with fund utilization
Services for CY of 97.32 percent or PhP148.81
2017 million of its allotment of
PhP152.91 million
27 DA Physical targets of Physical targets of HVCDP with 3,955.00
the National High a total allotment of PhP3.955
Value Crops billion were not fully attained
Development due to various deficiencies noted
Program (HVCDP in the project implementation
during the year
21 targeted Only nine activities, out of 21 Not stated
activities in CY targeted activities in CY 2017
2017 for MFO 2 for MFO 2 under the NLP of
under the NLP of BAI, were attained with more
BAI than 100 percent; and remaining
12 activities were partially
attained as of year-end.
28 R4-B MSC 15 licensure The College has performed No specific
examinations above the national passing rates amount for
in only eight out of 15 licensure this AO
examinations taken by its
graduates
29 MSCAT 17 licensure Only eight examinations, out of No specific
examinations 17 licensure examinations amount for
participated in by the College in this AO
CY 2017, surpassed the national
passing percentage
30 OMSC Certificates of 14 curricular programs of the No specific
Program College have yet to secure amount for
Compliance Certificates of Program this AO
(COPC) from Compliance (COPC) from
CHED CHED and have to undergo
independent accreditations thus,
compliance of the academic
programs with the prescribed
standards could not be
ascertained
31 PSU 57 licensure 31 examinations, out of 57 No specific
examinations licensure examinations amount for
participated in by the University this AO
for CY 2017, were below the
national passing percentage set
by the Professional Regulations
Commission (PRC)
32 WPU 11 licensure The University has performed No specific
examinations above the national passing rates amount for
in seven out of the 11 licensure this AO
examinations taken by its
graduates
33 R5 BisCAST Improved physical Expected benefits from 36.54
facilities and improved physical facilities and
activities for activities for student were not
students fully attained contrary to RA
No. 8292, due to utilization of
only 46.28 per cent or PhP31.47
million Special Trust Fund
(STF) budget in CY 2017, out of
the total STF budget of
PhP68.01 million
399
Project/Program
Amount
(in M PhP)
Objectives
34 R5 PSU IGPs Two of the IGPs of the 0.04
University were not
economically and financially
viable, thereby defeating the
purpose of generating additional
income and developing the
entrepreneurial capabilities of
the stakeholders
35 CSU Income Generating Some projects of CSU-Main 0.94
Projects (IGPs) Campus and CSU-Panganiban
Campus suffered a net loss for
the past years due to lack of
proper monitoring resulting in
uncontrolled expenses
36 R6 UA Students’ Deficiencies noted in the 5.32
Yearbooks procurement and delivery of the
Students’ Yearbooks affected
the University’s efficiency and
effectiveness in providing the
benefits for which the students
have previously paid for
37 CSU Research and Lapses in the management and Not stated
Development implementation of Research and
Programs and Development Programs and
Projects Projects resulted in difficulty in
assessment of project progress
Non-compliance with the
prescribed percentage rate of
allocation and limitations on
adjustment/modification of
certain budget allocation
38 R8 LNU IGPs The projects include ventures AO on
39 PIT that do not provide maximum compliance
hands-on experience to students, thus, not
contrary to the twin objectives of quantifiable
IGP
40 NwSSU Other Professional Services 0.52
41 ESSU Some projects of Maydolong Not
and Guiuan Campuses were quantified;
mainly for “buy and sell AO
business” or “rental of facilities” focused on
that did not involve students non-
compliance
7.4.14.1 Revisit the existing annual work plans and targets, review current
efforts/strategies adopted and devise additional strategies, if needed,
and exert efforts to fully attain the set objectives to enable the
agencies to fulfill their mandates and deliver the expected services
to their clientele.
7.4.14.2 Expedite HLURB actions and decisions to resolve pending REM

and HOA cases and ensure that the target set based on the number
of cases required to be adjudicated and the number of days in which
actions shall be enforced or disputes shall be resolved be complied
in accordance with its functions, action plans and targets set and
other pertinent laws, rules and regulations.
400
7.4.14.3 For DFA, justify the provision of standby funds for all FSPs for
ATN and rescue and relief to be made available without the need to
request from DFA-HO as well as immediate hiring of competent
private counsel and court translator including the release of legal
assistance fund to protect and defend the rights and liberty of the
distressed OFWs. Moreover, DFA Posts to endeavor a higher target
of Filipino registration of certified voters and intensify participation
of these qualified Filipino voters in future national elections.
7.4.14.4 For BOC, exert more effort and employ new strategies in order to
achieve the Agency’s collection target. Strictly implement Section 2
of RA No. 9335 which prescribes sanctions against BOC officials
and employees who were not able to achieve their targets, and
reward those who had exceeded their targets. In addition, formulate
responsive policies and guidelines to improve the auction and
disposal system within the agency like setting a more realistic
timeline for failed bids, monitoring the status of proceedings for
abandoned items, and inspecting the containers with no information
for possible issuance of Decree of Abandonment. Moreover, cause
the immediate disposal of the overstayed containers, 982 sacks of
rice, and other forfeited/seized items in accordance with Customs
Modernization and Tariff Act (CMTA) provisions.
7.4.14.5 For DepEd, to come up with an effective monitoring and evaluation

system to identify key issues and other major factors affecting
implementation of programs/projects like the DepEd
Computerization Program (DCP) and School Furniture Program
(SFP) as well as the related actions to be taken to address these
issues. Review the Agency’s internal processes related to
procurement; look into the reported deficiencies on deliveries,
identify causes of delays for immediate rectification, and consider
performance feedback in the awarding of future contract in order to
hasten and improve delivery of expected services to the Agency’s
clientele; formulate also very specific guidelines on financial
reporting to prevent wastage of funds and safeguard government
resources; and ensure that existing DepEd guidelines are
consistently observed and provide for sanctions for violations, if
any. In the case of SFP, instill close coordination among DepEd
offices, Regional Offices (ROs)/District Offices (DOs), and LGUs
to identify the schools’ actual furniture requirements to avoid
oversupply; and conduct inventory of unutilized excess furniture for
transfer to other schools with furniture needs.
7.4.14.6 Justify the cause/s of the low accomplishments as against targets of

CHED’s PCARI and strengthen the monitoring mechanism of
research projects so that problems that will be encountered during
the projects’ implementation will be immediately addressed.
401
7.4.14.7 For DOTr, judiciously plan the procurement of Driver’s Licenses
(DLs), Validation Stickers (VSs) and Plate Year Tags (PYTs);
establish re-order point, when procurement is not for a yearly
requirement; inform the public of the availability of delivered DL,
VS and PYT and facilitate the issuance thereof to the claimants; and
coordinate with GPPB for the engagement of the services of private
printers to print said forms considering the delayed deliveries of
APO and NPO which obstructed the LTO’s timely issuance of these
forms thereby hindering the efficient apprehension of the law
enforcement sectors.
On LTFRB’s grant of franchises/Certificate of Public Convenience

(CPC), strictly adhere to existing specific governing Memorandum
Circulars (MCs) and agency policies to ensure completeness and
conformity with the documentary requirements so that only
qualified operators are granted valid franchises; and require the
concerned management personnel who participated in the
acceptance, processing, and approval of applications of CPCs for
unqualified operators to explain the non-adherence to these MCs.
7.4.14.8 On the implementation of DA’s National High Value Crops

Development Program (HVCDP), adopt the following measures,
among others: (a) fast track the project implementation to attain the
physical targets and strictly enforce the program
guidelines/regulations; (b) set comprehensive, attainable or
enforceable targets and timelines; (c) ensure annual work plan
(AWP) activities are provided with quantified performance
indicators and expenses are incurred in accordance with the
approved work and financial plan (WFP); (d) prioritize pipe-line
projects listed and approved for funding under the program during a
specified period; (e) closely monitor the distribution of the technical
support services; (f) compel suppliers to deliver seedlings on time
and impose liquidated damages for delays incurred; and (g) submit
the complete list of actual beneficiaries of the HVCDP to facilitate
validation by the audit team.
7.4.14.9 For SUCs, evaluate and determine the causes for the low
performance in licensure examinations and adopt measures and/or
strategies to address the identified causes to improve the performance
of its graduates in succeeding examinations; utilize efficiently the
Fiduciary Funds for their targeted programs/projects/activities to
provide utmost benefits to the students instead of allowing the
funds/deposits to accumulate in the bank; revisit the current
operations of the Income Generating Projects (IGPs) and ensure that
objectives set forth in the Manual of Operations for IGPs of SUCs
are effectively met. On research and development (R & D) projects,
strictly observe the School’s R & D Manual provisions, and ensure
that research projects are covered with agreements executed between
the School and the proponents of approved research proposals,
among others.
402
7.4.15 On Department of Social Welfare and Development (DSWD) Projects
7.4.15.1 The financial management of funds intended for Pantawid

Pamilya Pilipino Program (4Ps) beneficiaries needs more
improvement since the following problems persisted:
a) Unclaimed cash grants of 4Ps beneficiaries for CYs 2013 to

2017, refunded by LBP conduits, amounting to PhP5.385
billion, showed an increase from the PhP3.108 billion as of
CY 2016, and still not returned to the BTr contrary to
Section 88, General Provisions, CY 2017 GAA.
b) Fund transfers (FTs) to LBP for Over the Counter (OTC)

payments to 4Ps beneficiaries have an unliquidated balance
of PhP10.746 billion as of 31 December 2017, of which
PhP4.655 billion represents FTs from 2012 to 2016. As
required in the MOA dated 14 July 2011, LBP shall submit
liquidation documents within five working days from the last
date of scheduled pay-out.
c) Unwithdrawn balances in 1,889,994 accounts of 4Ps’

beneficiaries ranged from PhP501.00 to PhP50,000.00. Of the
amount, PhP1.206 billion was not withdrawn from 30 to
2,190 days. This condition manifests that some 4Ps’
beneficiaries have no immediate need of financial assistance
thus, casting doubt on the eligibility of these chosen
beneficiaries.
7.4.15.2 Kapit-bisig Laban sa Kahirapan - Comprehensive and

Integrated Delivery of Social Services (KALAHI-CIDSS) --
National Community Driven Development Project (KC-
NCDDP) Project of DSWD registered physical accomplishment
of 81.32 percent, slightly below the 85 percent KC-NCDDP
Results Framework for CY 2017 requirement per loan
agreement.
After three years of project implementation, there was an

increasing pattern in the agency’s percentage of
accomplishments; thus, providing more community-
beneficiaries access to basic social services, infrastructures and
other benefits due them.
However, there were reported observations which may

compromise the project’s effectiveness and efficiency and
reliability of reports, as shown below:
Fourteen (14) sub-projects (SPs) costing PhP15.335 million have

existing deficiencies/issues such as non-functional water
system, materials were left exposed and unsecured, damaged
403
road improvement/concreting of pathway, defective solar lights,
and unimplemented road construction due to failure of the
Regional Project Management Office (RPMO)/Sub-Regional
Project Management Office (SRPMO) and project proponents
to monitor and resolve these issues; and
Low percentage of implementation/downloading of community

grants of 62.58 percent as against the 82.65 percent target per
KC-NCDDP Operations Manual, and huge unutilized amount of
PhP4.805 billion million remained in the bank as at 31
December 2017.
7.4.16 The Auditors recommended that DSWD concerned officials:
Conditional Cash Transfer Projects
a) As in prior year’s recommendation, remit in full to the BTr the amount

refunded by LBP conduits representing unclaimed cash grants for prior
years. Strengthen the policy on the forfeiture of unclaimed cash grants and
remittance of refunds to the BTr.
b) Require the LBP to strictly adhere to the provisions of the MOA and to
explain or justify the non-release of the needed cash for the 4Ps
beneficiaries, if warranted.
c) Expedite the validation/investigation/re-assessment of the eligibility of

concerned beneficiaries and fast-track the implementation of the
resolution to address the problem.
d) Intensify the monitoring and follow-up of beneficiaries by field personnel

and the updating of the data base for the non-compliant/delisted
beneficiaries; and
e) Strictly implement NAC Resolution No. 41, Series of 2017.
KC-NDCPP
a) Commend the DSWD Project Management Office (PMO) for the

increased accomplishments.
b) For the uncompleted SPs, concerned Area Coordination Teams (ACTs)

and Regional Project Management Office (RPMO) personnel to: (1)
regularly monitor the ongoing and unimplemented SPs, especially those
in the far-flung areas, and to fast track the completion of the SPs; (2) seek
assistance of the local government in the acquisition of project sites; (3)
make representations with the concerned government agencies for the
immediate release of clearances and permits needed for the projects; (4)
enjoin the community to work within the timeline of the project
implementation; and (5) furnish the Barangay Sub-Project Management
404
Committees (BSPMCs) with the list of contractors and suppliers in good
standing and blacklist erring contractors and suppliers.
7.4.17 Health Facilities Enhancement Program (HFEP) of the Department

of Health (DOH) was envisioned to revitalize the primary health care
facilities at various levels of government hospitals. It specifically aims to
upgrade said facilities in the provinces to make them more responsive to
the health needs of the catchment population, among others.
In CY 2017, the following Program-related observations were noted during the

audit, some of which recurring through the years:
a) Unattained objective of the HFEP Tamang Serbisyo para sa Kalusugan

ng Pamilya (TSeKaP) to construct 5,700 units of school-based Barangay
Health Station (BHS) amounting to PhP8.131 billion due to inadequate
planning and coordination with the DepEd and the LGUs in the
identification of project sites, inadequate documentation, inadequate
monitoring of the project, unclear contract terms for the basis of payment
which caused the majority of the BHS units to be not started, idle/not yet
turned-over and not completed within the contracted time, duplication of
BHS in the same barangay, with undelivered accessories/ equipment
and/or uninstalled toilet facilities.
Moreover, the conduct of bidding for the procurement of construction of

3,200 units under HFEP BHS–TseKaP Phase I amounting to PhP4.457
bilion was not in conformity with GPPB Circular No. 09-2015 dated 18
August 2015 and Investment Coordination Committee (ICC)
Memorandum entitled, “ICC Procedure on the Review and Approval
Process for Public Biddings/Facilities Costing At Least Php1 Billion”
dated 14 July 2014.
b) Mobile Dental Vehicles (MDVs), TSeKaP Packages and other various

HFEP Equipment in various DOH agencies/hospitals in NCR and other
regions aggregating PhP457.178 million were found with defects/
incomplete accessories, unrecorded in the books of the recipients,
idle/unutilized/not fully utilized, not received by/not distributed to
intended recipients, or with improper labelling.
c) Various HFEP infrastructure projects with total contract costs of PhP4.099

billion were either not yet started, uncompleted within the specified
contract time, with delayed implementation, abandoned, suspended, found
with defects, unutilized or not utilized by intended recipients, and recorded
with no supporting documents.
d) Regional Offices in DOH Regions IV-A, IV-B and CAR were not
provided with transfer/distribution/re-location documents of MDVs and
TSeKaP packages, contrary to DOH Department Memorandum No. 2017-
0181 dated 17 April 2017.
405
7.4.18 The Auditors recommended that concerned DOH officials, among others:
a) Conduct a thorough assessment of the project whether there is a need to

continue it, otherwise, remit the unused fund to the BTr; improve
procurement planning and strengthen coordination with project
implementers/partners to ensure timely project implementation and
prevent/ minimize incurrence of delays; ensure that agreement/contract
provisions are clear, definite and concrete to avoid misinterpretation and
disagreements; evaluate and investigate inefficient project implementation,
or non-completion of the contract by the Contractor and consider the
recoupment of advances from the contractor and undertake/file the
appropriate legal actions/remedies; and strictly comply with the provisions
of RA No. 9184 and its Revised Implementing Rules and Regulations
(IRR).
b) Conduct strict validation, continuous monitoring and coordination process

on the completeness of delivery, acceptance, utilization, redistribution of
unutilized equipment, availability of space/reagents/vaccines/
pharmaceutical medicines/manpower and training of personnel, proper
tagging of equipment, among others; establish a coordination process with
the intended recipients during the preparation of the Project Procurement
Management Plan (PPMP); and henceforth, ensure strict compliance with
DOH DM No. 2017-0107 dated 6 March 2017 and DM No. 2016-0220
dated 23 June 2016 which require the DOH Regional HFEP Teams to
extend their validation and monitoring of equipment up to its proper
disclosure in the books of accounts.
c) Prepare/comply with all pending requirements needed to immediately

facilitate the completion of all pending health facilities and plan early and
adequately to avoid revisions/changes in awarded contracts; strictly monitor
and coordinate the immediate completion of both projects on the expected
target date/s of completion; comply with the provisions of DOH DO No. 2016-
0045 to mitigate problems that may arise during project implementation, thus,
preventing delay or possible termination of contracts; impose and collect
liquidated damages for the time elapsed; and consider rescinding/
terminating contracts of infrastructure projects with negative slippage of
more than 10 percent due to the fault or negligence of the contractor.
d) Ensure the implementation of DOH DM No. 2017-0181 by communicating

this memorandum to counterpart HFDB in the Regional Offices, providing
them the necessary schedules and establishing a documented, continuous
coordination process.
7.4.19 On Department of Energy (DOE) Projects
7.4.19.1 Delayed implementation of the Market Transformation

through Introduction of Energy Efficient Electric Vehicles
(E-Trikes) Project, funded from ADB loans and amounting to
PhP17.981 billion in September 2013, resulted in the non-
406
achievement of the project outputs and objectives to deliver
quality E-Trikes to the intended beneficiaries; huge amount of
commitment charges and management fees amounting to
PhP94.029 million tantamount to wastage of government funds.
The delay in project implementation is attributed to: (a)

extended procurement activities for the E-Trike units and
consultancy services, (b) non-identification of the LGUs that will
distribute the E-Trikes and provide loan guarantees to their local
tricycle drivers, and (c) inability of the DOE to get commitment
from any financial institution that will finance the payment of the
procured E-Trikes.
7.4.19.2 The Household Electrification Program (HEP), with a total

budget of PhP992.658 million for CYs 2011 to 2017, was not
efficiently and effectively implemented due to the absence of
clear and adequate implementation guidelines resulting in: (a)
delays in the completion of electrification projects ranging from
3 to 1,305 days, (b) unverified accomplishments, (c) obligations
without adequate documentation, (d) non-establishment of
service centers to expeditiously act on warranty claims, and (e)
failure to secure commitments from Local Government Units
(LGUs) and Rural Electric Cooperatives (RECs) through a
Memorandum of Agreement (MOA) prior to the conduct of
technical trainings for the maintenance of the installed units, and
monitor the collection of counterpart funds to ensure project
sustainability.
7.4.20 The Auditors recommended that concerned DOE officials:
E-Trikes Project
7.4.20.1 Require the E-Trikes Project Management Unit (PMU)/Project

Administration Office (PAO) to hasten coordination with prospective
LGUs for the distribution of the 3,000 E-Trike units to the intended
beneficiaries to avoid further delays in the achievement of project
objectives, incurrence of commitment charges and management fees,
and the possible expiration of the undisbursed loan funds; and make
representation with the NEDA for the formulation of a policy which
will hold the concerned officials and contractors liable for the
management fees and commitment charges incurred as a result of
delayed implementation of foreign-assisted projects.
HEP Project
7.4.20.2 Formulate adequate and clear guidelines on the implementation of

2018 HEP, particularly in the identification of target beneficiaries
and procurement process; fast track the completion of the 2014 to
2017 HEP projects and impose liquidated damages and forfeit the
performance bond of project contractors who have incurred delays.
407
Consider conducting a 100 percent inspection of the projects and
validation of the status reports prior to the release of full payment to
the project contractors; conduct an extensive internal audit on the
Counterpart Fund of Sitio Power Associations (SoPA) and formulate
a monitoring scheme for said Fund; include the Photovoltaic (PV)
Streetlights and Micro-hydro Systems in the tariff system; and
execute the necessary Deed of Donations to the concerned LGUs and
Rural Electric Cooperatives (RECs), among others.
7.4.21 On Department of Transportation (DOTr) Projects
7.4.21.1 DOTr - Metro Rail Transit (MRT) 3 Capacity Expansion

(CAPEX) Project Lots 1 and 2. The revenue operations of the
48 Light Rail Vehicles (LRVs) delivered by DALIAN Co., Ltd.
with total cost of PhP3.759 billion is delayed for 345 days as of 31
December 2017 reckoned from its scheduled delivery date, with
an estimated liquidated damages amounting to PhP1.297 billion,
due to glitches in power supply, compatibility on signaling
system, and weight issues. As a result, long queues and
overcrowding of passengers in MRT stations were not cushioned
affecting the welfare of the riding public and contributing to the
decline in passenger ridership from 176,058,278 passengers per
day in CY 2013 to 140,152,161 passengers per day in CY 2017.
7.4.21.2 Capacity Enhancement of Mass Transit Systems in Metro Manila

Project (CEMTSMMP) and Cebu Bus Rapid Transit Project
(CBRTP). The intended outcome of CEMTMMP and CBRTP,
with loan amount of ¥43,252 million and US$198.5 million,
respectively, to mitigate traffic congestion and air pollution in
Metro Manila and Cebu was not timely achieved due to delayed
project implementation caused mainly by the transfer of the
procurement of Technical Support Consultant (TSC) for the
CBRTP from the DOTr to Procurement Service – Department of
Budget and Management (PS-DBM) and lack of interested
bidders for the CEMTSMMP. Consequently, delays in project
implementation also resulted in low utilization/availment of loan
proceeds of approximately PhP15.144 billion and incurrence of
Commitment Fees (CFs) amounting to PhP90.466 million for
CYs 2014 to 2017.
7.4.21.3 Public Utility Vehicle (PUV) Modernization Program. Of the total

funds earmarked in the CYs 2015 to 2017 GAA amounting to
PhP569.477 million for the PUV Rationalization and
Modernization Programs, only PhP88.51 million or 15.54 percent
thereof, was transferred to the Implementing Agencies (IAs) as at
year-end due to the unreadiness of the IAs to implement the
projects. Moreover, of the total funds transferred, only PhP1.866
million or 0.33 percent, or less than one percent, was actually
408
disbursed by the IAs, thereby delaying the attainment of the
program objectives.
7.4.22 The Auditors recommended that concerned DOTr officials:
MRT Project
7.4.22.1 Act with urgency in resolving the compatibility issues relating to

CAPEX Lot 1 to cushion the impact of the declining number of old
trains plying the rail tracks; impose liquidated damages on the
contractor, DALIAN Co., Ltd., pursuant to Clause 19 of the General
Conditions of the Contract; consider exercising the Agency’s option
to rescind the Contract, if warranted; and continue efforts in
addressing the issues/glitches in the MRT3 operations to regain the
wavering trust and confidence of the riding public and consequently,
increase the revenue collections that may be used to pay for equity
rentals to Metro Rail Transit Corporation.
CEMTSMMP & CBRTP Projects
7.4.22.2 Require the PMOs of the two projects to: (a) Prepare a revised
Detailed Time Schedule and a catch-up/work plan to attain the target
completion dates indicated in the agreed timelines and facilitate the
completion of the projects; (b) Adopt an effective project monitoring
system to ensure that loan drawdowns are on schedule, as embodied
in the loan agreement, to maximize availment of loan proceeds and
avoid payment of commitment fees; and (c) Consider holding liable
the concerned DOTr officials for the commitment fees incurred and
service fee to be paid to PS-DBM approximately amounting to
PhP2.952 million for causing undue injury to the government under
Section 3.g, RA No. 3019, as may be warranted.
Henceforth, evaluate/consider the capability of the transferee agency

to undertake the procurement of the project to prevent waste of time
and incurrence of service fee and commitment fees due to delayed
project implementation.
PUV Modernization Program
7.4.22.3 Fast track the release of funds for the PUV Rationalization
and Modernization projects to the IAs to catch up for the activities
which were behind schedule; instruct the LTFRB PMO to:
(a) Closely coordinate with the DOTr, DILG, selected LGUs and
other partner agencies to ensure that needed inputs in the project
implementation are provided and delivered as scheduled and/or
planned; (b) Expedite the review of the TOR for the PTIMC to
facilitate the conduct of procurement in the onset of CY 2018; and
(c) Come up with a revised program of work (POW) duly approved
by responsible officials, in case of major/significant changes in the
implementation plan and timeline due to justifiable reasons.
409
7.4.23 On Department of Agrarian Reform (DAR) Projects
Five on-going foreign assisted projects of the DAR (Mindanao Sustainable

Agrarian and Agriculture Development-MinSAAD, Agrarian Reform
Communities Project, Phase II-ARCP II, Agrarian Reform Infrastructure
Support Project, Phase III-ARISP III, Italian Agrarian Reform
Community Development Support Program-IARCDSP, and Convergence
on Value Chain Enhancement for Rural Growth and Empowerment-
ConVERGE) had low fund utilization due to delayed project
implementation which resulted in the accumulation and reversion of
funds of PhP3.554 billion and incurrence of commitment fees of
PhP10.330 million.
7.4.24 The Auditors recommended that concerned DAR officials prepare the
budget and cash programming in accordance with the project milestones to
ensure efficient and timely implementation of projects; continue to find ways
of addressing the bottlenecks encountered during implementation of these
projects; and conduct regular coordination with co-implementing agencies.
7.4.25 Transactions of 124 agencies amounting to PhP9.433 billion may be

considered either unauthorized/irregular, excessive or unnecessary for
being non-compliant with existing laws, rules and regulations; while
other disbursements lacked the required supporting documents hence, of
doubtful validity.
Amount
No. Cluster Agency Nature
(in M PhP)
A. Expenses without legal basis/Irregular Expenses
1 C1 NPO Honoraria and incentives for the printing of Official 9.61
Ballots and other election paraphernalia
CNA Incentives 9.35
2 MTRCB Additional benefits to the Board Members on the 5.22
basis of Minutes of Board Meetings and Board
Resolutions
3 C2 DOF Honoraria (net of taxes) to the TWCs, for the QMS- 5.12
and ISMS-related activities for ISO certification
4 C4 Napolcom Various allowances and benefits 51.22
5 BFP BAC Honoraria 0.25
Disbursements without legal basis and constitute 173.29
additional compensation such as: (a) Total Permanent
Physical Disability Pension (TPPD), (b) Hazard Pay,
and (c) reimbursement of Hospitalization expenses,
etc.
6 OCD Meal allowance to duty officers in the Operation 0.05
Center of OCD-NCR
7 C6 STII Monthly honoraria to the Head of the Agency as 0.12
Program Leader without approved Special Order
issued by the DOST Secretary
8 C5 DepEd Performance Based Bonus (PBB) paid without 2.73
compliance to the individual eligibility and
documentary requirements
Overtime services without authority and lacking in 40.27
supporting documents
410
Amount
(in M PhP)
C5 Mid-year bonus, clothing allowance and PBB to Job 0.18
Order (JO) workers in violation of Budget Circulars
Rice allowance 0.61
Cash allowances 0.33
Anniversary bonus and medical allowance 3.90
9 PNU Monetary incentives under the Expanded Programs on 0.07
Awards and Incentives for Service Excellence “E-
PRAISE” paid to Contract of Service Workers
Overtime services to University Top Officials 1.01
Honoraria paid to personnel who have no direct 0.04
involvement during the conduct of Licensure
Examination for Teachers (LET)
10 RTU Cash Grant paid to 393 regular and 138 contractual 10.55
personnel charged to the Special Trust Fund
Cash allowance paid to officials and employees paid 1.16
out of ESGP-PA Scholarship funds (three percent of
Administrative and Miscellaneous Cost or AMC)
11 DOLE Appreciation cash gifts to honor the invaluable 3.24
services of retiring officials and employees for CYs
2015-2017
12 C6 POPCOM Hazard Pay 0.13
Salaries and wages in ROs III and IX paid in advance 4.83
Extraordinary and Miscellaneous Expenses paid to 0.04
Officer-in-Charge (OIC)-Regional Director of RO XI
for the period from July 2017 to November 2017
Rental expense of the Cordillera Administrative 0.45
Region (CAR) charged to the alleged savings from
the agency’s Family Planning Program (FPP) budget,
without authority
13 DOST Attendance, leave, undertimes and tardiness in the 0.08
official record have been disregarded for salaries,
bonuses and allowances (RO II)
Not in accordance with the JC-for Hazard Pay; level 0.79
of risk was not considered in the computation of
workdays of actual exposure to hazards; no attached
Summary of Hazard Exposure for the month of March
2017; and local travel or attendances to seminars/
meetings/workshops/ trainings or similar activities
outside the work area or its DOST-attached agencies
was not deducted from the actual days of exposure;-
Management did not consider the number of
workdays of actual exposure over 22 workdays in a
month (RO XI), among others
Failure of management to comply with pertinent 0.60
provisions of RA No. 8493 for Longevity Pay
(RO XI)
14 C7 OTC Clothing allowance to newly hired employees who 0.07
have not rendered the required six months service;
and transportation allowances to the OTC Chairman
provided with service vehicle
Payment to 23 COS personnel hired without technical 1.76
expertise and performed regular functions of the
agency
15 MARINA Performance-Based Bonus (PBB) for CY 2016 paid 0.11
to MARINA - CO officials and employees who failed
to liquidate their cash advances within the
reglementary period
16 MVUC Personnel Education Assistance Grant (PEAG) of 2.60
PhP0.44 million and Performance Efficiency
Incentive Bonus (PEIB) of PhP2.16 million granted to
19 RBS regular, contractual, COS personnel
17 C8 DA Bonus of officials and employees in ATI-CO 4.59
411
Amount
(in M PhP)
C8 PhP35,000.00 each
Program Management Incentive at PhP3,333.33 each 0.10
granted in RTC III
Year-end Productivity Incentive by the PRDP 1.26
RPCO I
18 CAR MSCPC RATA paid to designated officials who were not 0.28
eligible to receive the same
19 R1 DMMMSU Collective Negotiation Agreement (CNA) Incentive 1.76
for CY 2017 granted in full to faculty and staff who
are on Study Leave during the year
CNA incentives to DMMMSU officials who are not 0.10
among those entitled
Honoraria to a member of the BAC Secretariat whose 0.04
position is in the Procurement Unit of DMMMSU
Honorarium to Committees and Resource Persons in 0.08
the conduct of Pre-Board meetings
20 UNP Unauthorized Claim for Honoraria 0.40
Unauthorized Cash Incentives 0.24
21 NLPSC Unauthorized Honoraria of the Board of Trustees 0.08
22 ISPSC Unauthorized Claim for Honoraria 0.12
Unauthorized Honoraria for Overload Services 0.33
Unauthorized Travelling Allowances of Board of 0.09
Trustees
23 MMSU Incentives to University officials and employees, JOs, 2.00
and COS personnel for CYs 2015-2016 as share from
the earnings of various Income Generating Projects
(IGPs)
24 R2 BSC Honoraria to administrative and finance personnel 0.02
charged to a special project
Clothing allowance of eight BSC Employees who are 0.04
on study leave or study/training/scholarship grant for
more than six months
25 CSU Travelling allowances paid to COS individuals 0.03
26 QSU Honoraria to Technical Consultants for the various 0.21
infrastructure projects of the University
27 NVSU Honoraria amounting to PhP3,375.00 paid to
University Personnel who rendered work in line with
their regular functions
28 PSU Salaries and allowances of three University scholars 0.29
for AY 2016-2017 under the Scholarship Agreement/
Graduate Program-Local due to withdrawal on
scholarship after just a month/semester.
29 R6 UA Salaries of designated Vice-Presidents for 1.05
Administration and Finance and for Academic Affairs
without permanent appointments
Overpayment of salaries and PERA of casual 0.02
employees
Disbursements for foreign travels of doubtful validity 0.67
30 WVSU Honoraria to WVSU Medical Center officials and 5.39
personnel utilizing Newborn Screening (NBS) fees
collected
Representation and Transportation Allowances 0.48
(RATA) paid to Newborn Screening Center (NSC)
Visayas officials
31 ISCOF Irregular transaction as payment made despite non- 4.22
conformity with the specifications of 54 ICT
equipment and computer software found to be
deficient and substandard
32 R8 NwSSU Honoraria granted in CY 2017 to the members of the 0.61
Infrastructure Project Management Committee
(IPMC) and Constructors Performance Evaluators
412
Amount
(in M PhP)
(CPEs) Team
33 R9 JRMSU Honoraria of officials of JRMSU – Dipolog, 0.29
Katipunan and Siocon Campuses
Honoraria for Teaching Overload to instructors 0.10
without the approval of the President of the State
University
Overpayment of salaries of 35 personnel of JRMSU 0.66
Tampilisan
34 R10 USTP- Overpayment of salaries incurred by a Faculty 0.04
Claveria Member who at the same time works as Project
Leader for externally funded-special project
35 R11 USeP Mid-year bonuses of various COS personnel 0.21
Per diems reimbursed to personnel on COS and JO 0.02
contracts
36 R16 NONES Salary differential and bonuses of regular teachers 1.44
COST were charged against the STF
37 CHMSC 1.03
38 NORSU 0.07
NONES Cultural and athletic allowance 0.11
COST
Sub-Total 358.25
B. Excessive Expenses/Expenses granted beyond approved rates
39 C1 NIB Daily Subsistence Allowances (DSAs) for foreign 0.06
travels of five employees which were excessive
40 NHCP Incidental expenses paid despite the provision by the 0.06
sponsoring organization of allowance which covered
other expenses
41 PBS- Excess payments of PhP0.46 million, or 26.10 percent 0.46
RTVM more than the actual price of PhP1.3 million, in the
purchase of local airfare tickets from PAL covering
the period April 12-30, 2016
42 PCW Payment for work rendered by CoS/JO personnel in 0.20
excess of their regular work hours
43 BBS Additional mobile telephone expenses incurred by the 0.29
agency
44 C4 DILG Representation expenses incurred which are similar to 2.06
the expenses claimed by the same officials for EME
NAPOLCOM Overpayment of travel allowance in the Central 0.53
Office and in two regions for the period September to
December 2017 at the rate of PhP1,500.00 per day
instead of the prescribed travel allowance of only
PhP800.00 per day
45 AFP-GHQ Overpayment of DSA of 19 PAF personnel 0.52
Overpayment of pension benefits due erroneous 7.89
computation of monthly pension benefits and failure
of AFPPGMC Management to conduct cross-
matching of pensioners’ data
46 OSG Honoraria/allowances paid to some OSG officials for 10.77
legal services exceeded the fifty percent of the annual
basic salary
Excessive claims for local and foreign travel 0.13
allowances totaling PhP0.054 million and PhP0.078
million, respectively
47 OGCC Allowances received by the OGCC lawyers for legal 0.62
services rendered to various client government
corporations for CY 2017 exceeded the limitation of
50 percent based on their annual basic salary
48 C5 MPC Overpayment in maternity benefits of five employees 0.06
due to erroneous computation
EME of the Presidents and OIC-Presidents of MPC 0.04
exceeded the authorized amount per FYs 2015-2017
GAA
413
Amount
(in M PhP)
49 C5 PUP Financial benefits of 69 students/grantees under the 0.72
Tulong Dunong Program exceeded the maximum
allowable grant
DepEd CNA paid to 15 school personnel even if already paid 0.45
by the Division Office
Communication expenses without proper authority 3.91
and excess claim from the allowable rates
Excessive grant of honoraria 2.43
PNU Excessive RATA paid to some key officials of the 0.04
University
Excessive honoraria for teaching overload due to 0.80
improper use of Prime Hourly Teaching Rate (PHTR)
50 PhilSCA Telephone Expenses paid in excess of the authorized 1.01
postpaid plans of various officials and employees,
telephone bills paid to unknown users, and payments
lacking in documentation
51 CHED Expenditures without legal basis/excessive in CHED- 2.43
CO and five CHEDROs
52 C6 FNRI Honoraria paid in excess of the authorized 25 percent 4.52
annual salary of five employees
53 PTRI Honoraria computed using a fixed rate and was in 0.90
excess of 25 percent of the annual salaries of
employees
54 NCDA Cellular phone load allowance to NCDA officers and 0.14
employees in excess of the cost ceiling requirement
POPCOM Amounts claimed/paid for Security Services in excess 0.01
of the allowed limit
R1 DMMMSU Payment of full salary to faculty members granted 10.23
scholarship from the CHED and who are on study
leave
55 R2 ISU Excessive claims/reimbursements of communication 0.38
expenses
56 R4A Cavite SU Monetization of leave credits were granted without 2.74
adhering to the guidelines -Main Campus 0.48
Naic Campus, and
Rosario Campus 0.17
57 R4-B PCSDS Excessive claims for travel expenses.e not in 0.10
accordance with the prescribed rates
58 R6 UA Excess claims on travel reimbursements; taxi fares, 0.01
terminal fees and VISA fees prior to departure to a
foreign country reimbursed despite the grant of pre-
departure allowance
WVSU Excessive disbursements - Funds disbursed for meals 0.14
and lodging of the Medical Center Chief relative to
attendance to seminars, meetings and conferences
59 R9 ZSCMST Honoraria to four Office of the Solicitor General 0.42
(OSG) lawyers based on fixed monthly allowances
instead of actual services rendered
60 R10 MSU- RATA claimed more than the amount entitled thereto; 0.04
MSAT and without supporting documents
61 R11 DOSCST Overpayments to the Davao Oriental State College of 0.39
Science and Technology-Multi-Purpose Cooperative
(DOSCST-MPC) due to erroneous computation of
rates per meals for the ESGP-PA scholars
Sub-Total 56.15
C. Disbursements/Expenses without or lacking supporting documents
62 C1 NCIP Disbursements in CAR and RO Nos. IX, X and XIII 8.09
made despite the lack of supporting documents
63 CDA Various expenses for CY 2017 unsupported with 23.07
required documents
64 OP Medical and Burial assistance - out of the 1,751 WIA 1.10
Uniformed Personnel, 11 unsupported with medical
414
Amount
(in M PhP)
C1 certificate or certification from the Chief Surgeon
General
65 PCC Various liquidation reports (LRs) for foreign travels 9.90
for CY 2017 unsupported with complete documentary
requirements
66 OPAPP Necessity of chartered flights for some local travels of 2.88
officials and personnel could not be determined as
documents supporting pertained to activities
organized by the OPAPP in partnership with CAR
RDC
67 HLURB Disbursements of HLURB-CVRFO and STRFO 13.48
processed and paid without proper/complete
PCW Rice allowance paid to PCW officers and employees 0.78
without supporting documents
MTRCB Monitoring expenses granted to BMs and Special 6.01
Agents, paid and recorded as Travelling Expenses,
without proper supporting documents
68 PDEA Disbursements/expenses relating to the lease of motor 32.50
vehicles surveillance operations charged against
regular and trust funds with inadequate
documentation
69 PLLO Validity and regularity of the Consultancy Services 4.10
account unascertained since expected deliverables/
outputs not specifically provided for in the
consultancy contracts nor stipulated in the TOR; no
curriculum vitae and Approved Consultancy Progress
or Final Reports, and/or output were submitted
70 DFA Payments for taxi fares in RCO Iloilo City not 0.02
supported by official receipt but by reimbursement
expense receipts (RER)
Overtime pay in the amount of USD11,450.56 for the
period of July 2015 to July 2016 to four local hires
was covered with authority ad infinitum (no peso
conversion given)
71 TCCP Disbursements not adequately supported with the 0.45
required documents
72 C3 CSC Unsupported expenditure for live-in seminars and 3.90
different programs/activities conducted in various
hotels in NCR and RO III
73 CHR Various financial transactions in CHR ROs I, III, VI, 2.41
XII, and XIII even without adequate/complete
documentation
C4 DILG Validity of disbursements cannot be ascertained due 107.45
to incomplete documentation
BFP Disbursements for ASEAN not covered with adequate 117.40
guidelines on payment of meal allowances and
billeting/ accommodation
74 BJMP Liquidation documents supporting various purchases 17.31
for the meals of inmates and the conduct of seminars;
workshops/lectures/trainings and/or other activities
are incomplete or have deficiencies
BAC honoraria charged to trust fund, paid without 0.07
any supporting documents
AFP-GHQ Opening of Letters of Credits, Wire Transfer to 3.65
Federal Reserve Bank New York City not duly
supported with the required documents
Construction of one-storey barracks not duly 3.65
supported with required documents
Official Receipts (ORs) for the claims of various 54.46
schools on the payments of tuition fees were not
attached to the DVs; some claims lacked supporting
documents
415
Amount
(in M PhP)
75 C4 DOJ Disbursement vouchers, pertaining to cash advances 234.05
for confidential expenses, not properly and
completely supported with required documents
specific for confidential funds
76 PAO Complete documentary requirements to support the 4.80
MOA in the construction of the proposed PAO-
Central Office Building not submitted
Napolcom Validity and propriety of disbursements in the Central 5.57
Office and in four regional offices unascertained due
to incomplete documentation
OCD Validity of payments for Fuel, Oil, and Lubricants 25.33
(FOL) products could not be established due to the
absence of basic documentary requirements
77 PA Payment of Reenlistment Clothing Allowance (RCA) 31.38
and Salaries and Wages of military personnel lacks
appropriate supporting documents to establish rightful
claims; balance consists mostly of prior year’s
accounts which remained unpaid/unclaimed as of 31
December 2017
78 PNP Procurement of various supplies and materials with 14.30
incomplete supporting documents
Inadequately supported expenses for payment of 121.41
personnel benefits and various MOOE in NCRPO of
PhP99.32 million, PRO 4B of PhP20.61 million, and
PRO 7 of PhP1.48 million
79 DND Failure to strictly enforce the proper preparation of 23.78
the Daily Trip Tickets before using the government
vehicle hence, fuel consumed cannot be ascertained
C5 DepEd Payment of monetization of leave credits without 10.15
proper documentation
Hazard pay paid to teaching and non-teaching 0.99
personnel without complete supporting documents
Centralized procurement of Supplementary Reading, 40.00
Reference and Other Instructional Materials sourced
out from school MOOE funds were resorted to by the
Division Office without pertinent documents
Various disbursements made without the necessary 422.28
CHED Expenditures not supported with adequate documents 158.80
PNU Disbursements from the General, Trust and Special 9.23
Trust Fund in CY 2017 necessary for the operations
of PNU-Mindanao made without the complete
80 NCCT Honoraria granted to resource persons/speakers (RPs) 1.79
and facilitators lacks information and pertinent
documents
PhilSCA Unsupported Proportional Vacation Pay (PVP) paid to 5.23
regular teaching personnel for the School Year
(SY)/Academic Year (AY) 2016-2017
81 C6 PCHRD Payment of honoraria to 58 officials and employees 2.77
lacked documentary requirements
82 PCIEERD Honoraria to PCIEERD officials and employees, 2.52
permanent and contractual, exceeded the allocated
budget in the GAA and in the LIB of various GIA
program/projects; and not supported by complete
documentation
83 NPC Reimbursement of the actual cost of hotel 0.22
accommodation allowed even without the required
certification of the Head of the Agency as to the
necessity of the expenses incurred
Complete documentation relative to the contract with 2.40
Social Weather Stations Inc. (SWS) by the NPC not
submitted
416
Amount
(in M PhP)
84 C6 CWC Cash advances paid to a DZMM reporter to cover the 1.05
activities of the CWC's celebration of National
Children's Month without execution of contract or
public bidding
POPCOM Procurement of a motor vehicle not in accordance 0.70
with the Revised Motor Vehicle Classification and
Specifications Guide; disbursement voucher was not
supported with the DBM Secretary’s approval
Disbursements in POPCOM-CO and ROs III, V and 3.67
VII were not supported with documentary
requirements
85 DOST Distribution of cell cards to all regular, contractual 0.45
and JO employees of DOST RO VIII with incomplete
supporting documents and lack of basis
Unsupported grant of Medical Expenses- DOST RO 0.33
XII
Absence of Individual Monthly Report of Actual 2.32
Hazard Exposure and inappropriate computation of
Hazard Allowance in DOST RO XIII
86 STII Reimbursement of mobile prepaid cell cards of 0.08
officials and employees unsupported with actual
expense receipts and other documents
Payment of training fee to Trust Management Center 0.30
for the conduct of Supervisory Development Program
SPD Basic and Advance Courses supported only with
Sales Invoice
Payment of Venue to Real Development Co. Inc. 0.25
(Days Hotel, Tagaytay) for the SDP Basic Course and
Saint Francis Square Development Corp (BSA Twin
Towers, Ortigas) for SDP Advance Course supported
with Statement of Account No. 006471 dated
December 6, 2017 and Statement of Account No.
4043 dated October 20, 2017 and Banquet Function
Agreements
87 NTC Payment for 106 disbursements vouchers (DVs) lacks 3.71
the required documents and/or not supported with
complete documentation
88 C7 NPDC Expenditures for the procurement of tailoring 6.97
services, services of hosts and performing artists and
website developer, various equipment and furniture,
and repair of electrical system not substantiated with
adequate supporting documents
MARINA Various unsupported disbursements for the payment 23.41
of tuition fee and accommodation, foreign travels,
leased venues for trainings, rentals of photocopying
machines, office space, audio-visual and
procurements for janitorial and security services
89 DOT Disbursements or 42 percent of the contract cost for 271.72
the Philippine Experience Campaign were not
supported with the documents required per TOR with
McCann Worldgroup Philippines, Inc.; there were
inconsistencies in the payment scheme and details of
billing invoice with the contract provisions
Lack of supporting documents on the payments made 45.00
to PTV amounting to PhP45 million; inconsistencies
in the frequency of airing of the DOT Television
Commercial (TVC) as compared with the MOA, the
approved media plan, and actual telecast based on the
Certificate of Performance were noted
90 DPWH Recorded disbursements of DPWH-OSEC, CAR, I-II, 4,160.99
IV-B-V, VII-XI with incomplete documentation
MVUC Payments pertaining to the consultancy services for 75.35
the Establishment of the Provincial and City
Locational Referencing System and Conduct of Road
417
Amount
(in M PhP)
C7 Inventory Survey project unsupported with adequate
documentary requirements
91 DOTr Non-submission of a valid Joint Venture Agreement 978.25
(JVA) by the purported Busan JV and contract
implementation by Busan Universal Rail, Inc.
(BURI), which is not a party to the contract thus,
doubtful legality/propriety of the contract for
negotiated procurement of DOTC-MRT3
Maintenance Service Provider, 43 LRVs General
Overhaul and the Total Replacement of the Signaling
System
92 R2 BSC Honoraria, allowance/incentives to certain officials 0.42
and employees not supported with sufficient
documents
CNA Incentives for CY 2017 not supported with 0.63
necessary documents to establish the validity of
incentives
93 R4-B MSCAT Payments for progress and final billings of nine 101.41
infrastructure projects not supported
PCSDS Disbursements charged to PCF like telephone bills, 0.84
meals and snacks, fuel and gasoline, and toll receipts
not supported with complete documentation
94 MSC Payment for the purchase of parcel of land situated at 2.00
Brgy. Matalaba, Sta. Cruz, Marinduque unsupported
with complete documentation
Contract/purchase order and other supporting 0.42
documents were not attached to the payment for the
roundtrip airfare of MSC delegation during the
STRASUC Olympics 2017 at OMSC, San Jose,
Occidental Mindoro
95 R3 CLSU Overtime claims of BAC Secretariat personnel were 0.12
paid without sufficient documentation
96 R5 BU Students allowed to reimburse travel allowance 0.01
without Official Receipts and Certificate of
97 CSPC Appearance to support the claim 0.01
Absence of substantial documentation of proofs of 0.02
exposure to risk casted doubt on the propriety of
Hazard Pay
98 BiSCAST Payment for Hazard Pay was not supported with 0.30
sufficient documents to prove that the claimants were
exposed to danger, perils to life and physical
hardships
Non-compliance with all the requirements on the 0.24
hiring of a consultant and not supported with
complete documentation
99 BU Honorarium given to the Project Leader, as resource 0.33
person/facilitator for the conducted trainings for 2016
cannot be validated due to lack of sufficient
document(s)
100 R6 ISTU Payments for Building Projects made to contractors 10.79
despite insufficiency of supporting documents
Funds transferred to Philippine Association of State 4.16
Universities and Colleges (PASUC) and PASUC VI,
101 GSC both private institutions lacked sufficient 0.51
documentation.
102 R8 RDC- Honorarium paid to Private Sector Representatives 0.34
Eastern (PSRs) in the attendance to various meetings as
Visayas Sectoral Committee Co-Chairmen and Members of
the RDC Region VIII without supporting documents;
and no tax withheld
Payments for fuel consumption not supported with 0.28
Monthly Report of Fuel Consumption (MRFC), and
Driver’s Trip Tickets were not properly filled-up
418
Amount
(in M PhP)
103 R8 PIT Disbursements for fuel, oil and lubricants not 0.71
supported by Driver’s Trip Tickets and the required
104 NMP Monthly Report of Fuel Consumption and Monthly 0.42
Report of Official Travels,
105 UEP Payments of financial assistance for educational tours 2.71
of ESGP PA grantees lacked supporting documents
106 R9 ZCSMCT Payment for official airfare ticket afor the travels 0.08
booked for the months of February and March 2017
not in accordance with the Memorandum of
Agreement (MOA); itinerary receipt not attached
R11 DOSCST Payments DOSCST-MPC for the meals served to 7.19
ESGP-PA scholars unsupported with complete
documentation
107 DNSC Claims for taxi fares not supported with Taximeter 0.10
Receipts (TR)
USeP 0.40
Sub-Total 7,238.67
D. Other Unauthorized/illegal/unnecessary Expenses
108 C1 NYC Representation Expense for CY 2017 included 0.27
unnecessary expenses for cost of meals and snacks
served during unauthorized meetings
HLURB Rental expenses for CY 2017 in HLURB-CVRFO 1.22
paid in advance
PCW Reimbursement of a prior period telephone expenses
from an unauthorized personal post-paid mobile line
PhP3,208.64 was illegal
109 UNACOM Use of landline telephone and service mobiles 0.31
indicates lapses on internal control which may result
to incurrence of unnecessary expenses
Expenses incurred for cultural and athletic activities 0.05
of the UNACOM personnel for the cost uniform and
registration fee for their participation in the Civil
Service Commission(CSC) Fun Run 2017 not in
accordance with Section 43 of General Provision(GP)
of 2017 (GAA).
110 C2 PSA Clothing materials for the 7th Session of the ACSSC 0.30
procured thru shopping not in compliance with COA
Cir. No. 2012-003; for refund
111 PS-DBM Distributed in CYs 2013–2017 a total of phP61.322 19.92
million, as profit share to different depot from the
income that accrued to the Revolving Fund, of which
PhP19.919 million were utilized without authority
from the GPPB and without consideration of the
restrictions in the use of ‘Revolving Fund’; the
Guidelines on: (i) Income Sharing; (ii) Depot
Giveaways; (iii) Loss of Assets; and (iv) Allowances,
provided for under the Manual are inconsistent with
the existing laws, rules and regulations
112 C4 PPA Payment of monetization of leave credits to officials 46.26
and employees of the Central Office and 14 regional
offices was made without complying with the
Omnibus Rules on Leave of the Civil Service
Commission (CSC)
113 OSG Unauthorized engagement of private lawyers and law 767.72
firms for legal services and professional fees due to
the absence of prior acquiescence of the OSG and
written concurrence of COA
DILG Unnecessary and excessive procurement of various 1.83
training supplies
BFP Disbursement for the Production and Release of 0.22
Yuletide Infomercial 2016 unnecessary
Payment of Special Financial Assistance (SFA) to the 3.07
beneficiaries of uniformed men of the BFP who
419
Amount
(in M PhP)
C4 passed away while in service due to natural causes
and not related to fire operations or in the
performance of their duties is without sufficient legal
basis
Napolcom Check drawn on 28 December 2017 in favor of the 3.77
supplier despite non – delivery and installation of the
Local Area Network Infrastructure project contrary to
the provision of the contract.
AFP-GHQ Same invoices included in both advice of 60.26
payment/drawdown; hence, resulted in the
double/over payment.
C5 DepEd Hiring of consultants and contract of service 120.91
personnel not founded on necessity and
reasonableness
Payment of RATA despite provision of a government 1.12
vehicle
Payment of various traveling/training expenses 56.93
without authority.
Grant of honoraria was made out of savings rather 1.27
than from the proceeds of sold out bidding documents
Disbursements without appropriate funding 0.18
Unjustified incurrence of food expenses by the 1.13
Disbursing Officer for entertainment of visitors,
celebrations, performance assessment and o
activities
Various expenses paid without observing the 108.67
appropriate standard and procedures of processing
disbursements
CHED Unnecessary and extravagant procurement of high- 0.94
end cellular phone and 14 units of laptop of PhP0.938
million in CHEDRO X
114 C6 PSHS Expenditures considered irregular and excessive due 1.04
to either non-conformity to established rules and
regulations, and/or erroneous computation
115 ICAB Unnecessary expenditures incurred 0.44
116 JJWC Agency could have saved an estimated amount up to 0.16
PhP0.16 million had it prudently planned its internet
subscription
117 NNC Unnecessary and extravagant expenditures incurred 0.53
during the celebration of the agency's 42nd
anniversary
118 ITDI Failure to observe the suspension of foreign travels as 6.59
an austerity measure and did not comply with the
restrictions imposed for foreign travels
POPCOM Grant of Extraordinary and Miscellaneous Expenses) 0.04
to the Officer-in-Charge (OIC)-Regional Director of
POPCOM RO XI for the period from July 2017 to
November 2017 without legal basis
119 C7 DOE Irregular, unnecessary and excessive expenditures 5.21
such as: (1) fund transfer to Pampanga State
Agricultural University charged to the Regular
Agency Fund instead of the Special Accounts-Locally
Funded Projects which covers HEP; (2) procurement
of six Apple Macbook laptops and 20 Go Pro
cameras; and (3) procurement of spare parts
considering that the PVSHS supplied and installed are
new and free of defects and covered by warranty
120 OTC Purchased of a pick-up vehicle with a five-passenger 1.20
capacity instead of a passenger van with engine
displacement not exceeding 2,200 cc for
gasoline/3,000 cc for diesel contrary to the approved
Authority to Purchase issued by the DOTr Secretary
and favorable recommendation of the DBM; made
420
Amount
(in M PhP)
C7 thru Negotiated Procurement instead of competitive
public bidding
Incurrence of irregular, unnecessary and excessive 0.26
expenses such as: (a) reimbursement of travelling
expenses; (b) penalty charges imposed by Philippine
Airlines due to trip cancellation; (c) travels of the
OTC Chairman without the authority of the DOTr
Secretary or his authorized representative; (d) EME
incurred during Saturdays, Sundays and holidays,
with places not indicated in the Travel Order; and (e)
honorarium without appropriation
NPDC Excessive travel expenses amounting to PhP0.015 0.49
million, and payments of PhP0.476 million to a
private lawyer hired without the acquiescence of the
Solicitor General and written concurrence of the COA
121 MMDA Unnecessary expenditure incurred due to insurance of 0.01
lost and unserviceable motor vehicles and heavy
equipment
MARINA Irregular, unnecessary, excessive and extravagant 19.26
expenses for training, representation and
transportation allowances, overtime pay, daily
subsistence allowance, mobile communications, bus
rentals, and extraordinary and miscellaneous expenses
MVUC Technical review and evaluation of seven (7) projects 12.23
disclosed: (a) excessive costs of PhP7.96 million due
to overstatement of quantity/costs of work items;
(b) overpayment over actual accomplishments of
PhP3.54 million; and (c) technical defects equivalent
to PhP0.73 million
Foreign travels to Dubai of four Road Board 0.56
Secretariat (RBS) employees approved by the RBS
Executive Director instead of the Department
Secretary
Double payments to Geodata Systems Technologies, 0.33
Inc., Geodata Solutions Inc., and Foresight
Development and Surveying Company (GGF Joint
Venture) for consultancy services of PhP0.32 million;
and car rentals of PhP5,800.00 without invoice or OR
as evidence of payments to Bisumi Tours and
Services
DPWH 334 infrastructure projects were found to have defects 40.92
equivalent to at least PhP40.92 million
In Regions I and XI, rental of 184 motor vehicles for 158.68
project supervision was found excessive; rented
motor vehicles in Region XI remained undelivered as
of 31 December 2017
Contract costs of various infrastructure projects 115.56
implemented by the DPWH-NCR, CAR, IX, XI and
XIII were found excessive due to cost estimates
exceeding the COA allowable cost of PhP37.99
million; and inclusion of unnecessary work item of
PhP77.57 million
DOTr Fund transfers of PhP204.95 million (US$4.32 204.95
million) to the OSG for payment of the services
rendered by the Foreign Legal Counsel assisting in
the international arbitral proceedings initiated by the
Metro Rail Transit Corporation (MRTC) without
securing the written concurrence of COA
122 PCG Official receipts (ORs) and sales invoices (SIs) 0.82
supporting the liquidation of cash advances of then
Commander/Special Disbursing Officer (SDO) of
Coast Guard District (CGD) National Capital Region–
Central Luzon (NCR–CL) either disowned or claimed
as fake/spurious by eleven suppliers/dealers
421
Amount
(in M PhP)
123 C8 NWRB Payment of two units of water quality checker/meter 0.52
made even when not yet delivered
CAR MPSPC Issuance of extra units of laptop to 22 officials and 2.85
employees rendered when such extra unit/s were not
being fully utilized
R1 DMMMSU Payment of communication allowances to employees, 0.55
out of income from tuition fees under Fund 164,
which is not authorized
MMSU Rehiring of former faculty members who retired 1.22
under the compulsory retirement age of 65 under
contract of service rendering payment of their
compensation irregular
R2 NVSU Actual disbursements for the project " Value Chain 0.20
Ananlysis for Pineapple"were not in accordance with
the budgeted expenditure, made in contravention with
the line item budget provided in the MOA between
the DA and NVSU
124 R4-B RSU Paid the services of a private legal counsel without the 0.53
written concurrence of COA
R5 BiSCAST Grant of 50 per cent advance payment to Consulting 0.24
Services
BU Procurement of Other Property Plant and Equipment 0.11
(OPPE) “Car Lift”, inclusive of the installation cost,
without appropriation and supporting documents
DEBESM Contract awarded to a contractor who is not eligible to 0.85
SCAT participate in the bidding for infrastructure projects
Payment of expenses other than the authorized 0.04
expenditures chargeable against the collections
R6 UA Extravagant expenditures - conduct of the UA FedFA 0.28
General Assembly in the Island of Boracay, Aklan
instead of using the facilities in the University
premises
GSC Expenses pertaining to food/catering services during 1.26
meetings exceeded Representation Expenses budget
by 141 percent in CY 2017
R11 USEP Payments made for Infrastructure Projects not 5.27
properly approved
Payments made to the OSG for the Legal Services 0.65
rendered have no legal basis
Excessive disbursements for mobile phone under 0.20
postpaid plan and various prepaid load allowances to
various employees
Sub-Total 1,780.40
GRAND TOTAL 9,433.47
Unauthorized expenses were reported in other four agencies although the

amounts were not disclosed/determined:
1 C1 MTRCB Monitoring allowance and rice subsidy contrary to the

revisedCompensation and Position Classification System (CPCS)
2 C2 BOC Overtime payment in excess of the 50 per cent of the annual salaries
of employees at the CDFPC; while the provisions set forth in the
rendition of overtime working hours not strictly observed and
complied with at the DHL Composite Division
3 R5 DEBESM Traveling expenses and overtime pay paid to JOs and COS
SCAT Instructors
4 R9 ZCSMCT Payment for Board of Trustee (BOT) per diems made prior to the
rendering of services/attendance in the board meeting
422
7.4.26 The Auditors recommended that concerned Agency Officials, among others:
7.4.26.1 Require the refund of unauthorized/illegal/irregular expenses such as

salaries, honoraria, RATA, overtime, and other allowances like CNA
Incentives, Rice Allowance, death/disability benefits, among others
granted by Management without legal basis, as well as overpayments
made not in accord with the prescribed/approved rates or formula;
stop the practice of granting monetary appreciation gifts or payment
of honoraria to employees undertaking regular functions/activities of
the Agency; and comply with CSC-COA-DBM Joint Circular No. 1
dated 15 June 2017 and CSC Memorandum No. 40 series of 1998
which prohibits the payment of benefits enjoyed by government
employees to the COS and JO personnel.
7.4.26.2 For BFP, justify the payment of double pension to active retirees who
compulsorily retired due to disability; strictly abide by the rules in
the grant/payment of Hazardous/Hazard Duty Pay; and revisit the
policy on the reimbursement of hospitalization expenses taking into
consideration R.A. No. 6963, among others.
7.4.26.3 For OSG, limit the receipt of allowances to not more than 50 percent
of personnel’s annual salary until such time that a decision on the ND
be resolved and become final and executor; require all handling
lawyers to strictly comply with OSG Office Order No. 188 series of
2009 requiring the Task Force Team Leaders to report all honoraria
directly received from client agencies together with the appropriate
BIR form evidencing withholding of taxes to FMS OSG; and submit
a copy of written authority and acquiescence of the OSG and COA
before the hiring of private lawyers and law firms.
7.4.26.4 Strictly comply with Section 4 of PD No. 1445 and COA Circular
No. 2012-001 dated 4 June 2012 and ensure that all government
disbursement are duly supported by complete documentation,
covered with the appropriations law or specific statutory authority,
and conform with existing laws, rules and regulations; and require
the concerned Accountants to observe the proper standard procedures
in processing disbursements as well as to immediately submit to
COA the lacking documents to support the disbursements of funds.
7.4.26.5 For DPWH, require all concerned contractors to rectify immediately

the deficiencies noted,or forfeit the Performance Security; consider
blacklisting of the contractors who refuses to effect the necessary
corrections; direct the Inspectorate Team to conduct regular and strict
monitoring and supervision to ensure that all contractors undertake
the projects in accordance with the approved program of works; stop
the practice of providing vehicle rentals per project and instead make
it on a per project engineer basis especially if the projects are being
implemented simultaneously.
423
7.4.26.6 For SUCs, refrain from paying benefits out of Special Trust Fund and
strictly follow the provisions of RA No. 8292 or the Higher
Education and Modernization Act of 1997 and the Salary
Standardization Law of 2009; and in the case of faculty members/
employees granted scholarship, strictly comply with the guidelines
on Study Leave, as prescribed in the Faculty Manual and the
provisions in the CHED Scholarship Agreements.
7.4.27 Violations in the transfer of cash amounting to PhP2.836 billion were

reported in nine agencies to avoid lapsing cash allocations and depriving
the government of additional funds.
Amount
(in M PhP)
C4 DOJ Practice of transferring funds to the ATM Payroll account 621.65
for transactions without valid expenditures
C5 DepED Unutilized NCAs from MDS account transferred to Trust 1,832.53
Account-LCCA without proper documentation
C7 DOT Funds in DOT RO IV-A irregularly transferred from the 0.65
Cash-National Treasury, Modified Disbursement System
(MDS), Regular Account to Cash in Bank, Local Currency
Current Account (CIB-LCCA)
R4-B PSU ESGPPA and Tulong Dunong Scholarship programs fund 14.78
from the GAA of 2016 and recorded under the account Cash
National Treasury, MDS, Regular was transferred to the
Local Currency Current Account (LCCA) of Fund 401 to
avoid the automatic reversion of the fund to the National
Treasury; the fund transfer was booked as Scholarship
Grants/Expenses under Fund 101 and as Trust Liabilities
under Fund 401 thus, overstating said accounts
PCSDS Funds from Cash – MDS Account transferred to Payroll 10.76
Fund without complete supporting documents to establish
validity of the claim defeating the objective of maximizing
the use of government’s resources
R5 BU An amount from the Specific Budget (RA No.10352-GAA 8.32
2013) was transferred to BUCAF IGP- Trust Account in CY
2014 and remained as Cash in Bank as of 31 December
2017
R6 UA Practice of transferring the External Campuses’ allocation 151.56
for CYs 2016 and 2017 directly to the operating units
instead of the DBM releasing to respective MDS Accounts
is contrary to DBM National Budget Circular (NBC) Nos.
561 and 567 dated 4 January 2016 and 3 January 2017,
respectively
ISCOF Practice of transferring cash support to the different 86.91
External Campuses through funding checks
NIPSC Practice of transferring cash support to the different 109.05
External Campuses through either funding checks or Advice
to Debit Account (ADA) for NCAs received is not in
conformity with DBM NBC No. 488 and COA Government
Accounting and Financial Management Information System
(GAFMIS) Circular Letter (CL) No. 2003-004
TOTAL 2,836.21
7.4.28 The Auditors recommended that concerned Agency officials discontinue/stop

the practice of transferring funds to either the ATM Payroll account, CIB-
LCCA, trust fund or any other account and immediately return to the BTr any
deposit without valid obligations. For SUCs, ensure strict compliance with
DBM NBC Nos. 488, 561 and 567 by discontinuing the practice of fund
424
transfers to operating units within the same Department/Agency and and COA
Circular No. 2013-002 through the use of the proper accounts in the
accounting of MDS transactions pertaining to SUCs.
7.4.29 Other significant transactions were reported in a number of agencies

considered to be not in accordance with existing laws, rules and
regulations which either affected the reliability of the financial reports or
grossly disadvantageous to the government.
Amount
(in M PhP)
1. Financial Statements (FSs) Not Restated contrary to PPSAS or GAM, Volume I
1 C4 PNP Non-restatement of the FSs for CY 2017 to 1,978.68
2 Napolcom reflect the effects of the prior period errors and 180.18
3 BFP other adjustments and non-disclosure of the 156.38
same in the Notes to FSs contrary to paragraphs
4 PPSC 36.70
47 and 54 of the Philippine Public Sector
5 BJMP 79.92
Accounting Standards (PPSAS)
6 PAF 1,229.83
7 BuCor 22.05
8 LRA 37.84
9 PPA 3.32
10 PA 6,061.81
11 C6 DICT CY 2016 figures presented in the CY 2017 FSs 4,314.26
not restated to reflect prior year errors and
adjustments contrary to Sections 42 (b) and 43 ,
Chapter 19 of the Government Accounting
Manual (GAM), Volume I; Accumulated
Surplus/(Deficit) of PhP4,314.26 million not
restated
12 R8 NwSSU The FS lack relevant disclosures in the Notes to 73.17
FS; other discussions contained therein could
not be cross-referenced to the FS.
13 VSU Non-observance of the disclosure requirements 1,156.50
in the Notes to FSs under the PPSASs
TOTAL 15,330.64
CY 2016 financial statements (FSs) were not restated in CY 2017 FSs in two
other agencies and the total effect was unquantified or not reported:
C1 OPAPP CY 2016 corresponding figures presented in the CY 2017 FSs not restated
to reflect prior period errors and adjustments.
C2 BLGF CY 2016 figures presented in the consolidated CY 2017 FSs not restated
to reflect prior year errors and adjustments
2. Failure to post in website of transparency seal/ submit list of all PPAs contrary to COA
Circular No. 2013-004
Amount
(in M PhP)
1 C2 BIR In RRO 11, signboards on various Infrastructure PPAs 30.54
were not installed in the required designated areas,
depriving the public of the information on PPAs being
undertaken by the agency
2 C4 BJMP The agency failed to post the appropriate project 4.99
signboards and/or public notices with respect to the
Construction of the BJMP-ARMM Regional Office
Building Phase I
3 R8 ESSU Failed to submit list of all on-going 91.96
projects/programs/activities (PPAs) in CY 2017 and
425
those that are to be implemented during the year
4 R11 USEP Infrastructure Projects did not strictly comply with the 138.40
requisites on the use of tarpaulins
TOTAL 265.89
Six other agencies failed to comply with the required transparency seal or post
in their websites the list of PPAs. No amounts were reported for these
observations:
1 C6 NPC The NPC did not fully comply with Section 93, General Provisions
of the 2017 GAA, particularly on the Agency’s maintenance of
Transparency Seal to be posted in its website, containing required
information enumerated therein to enhance transparency and enforce
accountability.
2 R8 NwSSU Failed to submit list of all on-going projects/programs/activities
(PPAs) in CY 2017 and those that are to be implemented during the
year
3 R9 JRMSU Reporting and monitoring of PPAs of the Dipolog Campus not
consistently complied, with reports submitted having incomplete and
inaccurate information
4 ZCSPC Reporting and monitoring of infrastructure projects of the College
not consistently complied, with reports submitted having incomplete
information and appropriate signboards were not posted
5 R11 MinDA Failed to notify and provide the Office of the Auditor the prescribed
6 DIDP reports on all completed/on-going government PPAs and those that
are to be implemented for CY 2017
3. Non-compliance with accounting/budget regulations

Amount
(in M PhP)
1 CAR BSU Cost of the project “Construction of the CTE 1.79
Building-Right Wing” not obligated upon perfection
of the contract, thus, with the lapse of the validity
period of the appropriations source, the unpaid
contract balance was without available funding
Overstated obligations incurred by PhP13.20 25.61
million, and Due and Demandable Obligations for
the scholarship programs by PhP12.41 million;
amounts unsupported with contractual commitments
2 R2 BSC Non-maintenance of General/Subsidiary Ledgers 129.94

and Registries contrary to Sections 111 and 114 of
PD 1445 and Section 12, Chapter 2 and Section 5,
Chapter 3 of GAM for NGAs Volume I
3 R4-B PCSDS General and Subsidiary Ledgers were not maintained 29.76
contrary to Sections 111, 112 and 114 of Presidential
Decree (PD) No. 1445, thus, accuracy and
correctness of balances of the accounts could not be
ascertained.
4 R6 UA Appropriations for the conduct of research activities 1.32
under GAA 2017 were allocated only for the UA-
MC affecting the overall achievement of the targets
on research
5 R10 NMSCST STF Budget not prepared in accordance with CHED 37.90
Memorandum No. 20 series of 2011, several lapses
and inconsistencies observed in financial
accountability reporting
6 R16 CHMSC The College exceeded its budget allocation for Free 19.07
Tuition 2017 contrary to JB No. 2017-1 dated April
20, 2017 of CHED and DBM
TOTAL 245.39
426
Reported observations in four other agencies contrary to existing accounting/
budget regulations which were not quantified are shown below:
1 C4 PPSC Failed to maintain a complete set of books of accounts in

compliance with Section 8, Chapter 2, Volume I of the Government
Accounting Manual (GAM) and to comply with reportorial
requirements
2 BuCor Iwahig Prison and Penal Farm (IPPF) failed to adopt in full the
Electronic Payments Scheme (EPS) in the disbursements of public
funds in violation of Section 79 of the General Provision of the
General Appropriations Act, Department of Budget and
Management (DBM) Circular Letter 2013-16 and Section 8,
Chapter 6, GAM, Volume 1 to address cash programming concerns
of the agencies by providing specific schedule of payments
3 R8 PIT Monthly financial reports submitted by PIT-Tabango Campus,
covering CY 2017 not in accordance with the forms required for
government units without complete set of books of accounts as
prescribed in pertinent provisions of GAM for NGAs Volume I
4 EVSU Non-adoption/non-use of the four registries prescribed in Chapter 3
of the GAM for NGAs Volume 1 for the purpose of monitoring the
budget
4. Non-conformity with RA No. 10121 or the Philippine Disaster Risk Reduction and
Management (PDRRM) Act of 2010 or RA No. 10924 (FY 2017 GAA)
Cluster
No. Agency Remarks
/RO
1 R9 JRMSU Non-formulation of PPAs for disaster risk reduction and climate
change adaptation and mitigation and non-allocation of funds in
conformity with RA No. 10121 or the PDRRM Act of 2010 and
RA No. 10924 or GAA for FY 2017
2 R10 PCC The Center has no Disaster Risk Reduction and Management
Program for CY 2017
3 MSU-IIT Failed to implement PPAs or participates in any disaster
4 MSU-LNAC activities conducted by various organizations from local or
national level
5 MSU-Naawan
6 MSU-MSAT
5. Non-compliance with Laws/Issuances pertaining to Personnel

Amount
(in M PhP)
1 C4 PVAO Continuous remittance of monthly pension of 72.51
beneficiaries despite blocking order due to
pensioner’s failure to comply with the PVAO’s
revalidation program and/or inclusion in the list of
terminated pensions by reason of death, remarriage
and fraud resulting in accumulation of idle funds with
Land Bank of the Philippines (LBP); unreliable
Integrated Veteran Database Management (IVDMS)
due to discrepancies and inconsistencies noted on the
date of suspension, termination and resumption for
those pensioners receiving two types of pension
claims
2 OSG Seven employees' net take home pay is below the 0.03
mandated minimum amount of PhP4,000.00 due to
accommodation for payroll deduction of employee
obligations
3 NBI 309 personnel received a monthly net take home pay 0.51
lower than 4,000.00 contrary to Section 47 of
Republic Act No. 10924, GAA of 2017
4 C7 NPDC Absence of concrete policies or guidelines in the 4.95
hiring of JO personnel resulting in the
427
5. Non-compliance with Laws/Issuances pertaining to Personnel
(a) employment of JO personnel based on the
endorsement of the Office of the Executive Director
and not through a transparent hiring and selection
process conducted by the HR Section; (b) hiring of JO
personnel to perform functions pertaining to vacant
regular plantilla positions; (c) inconsistent
compensation rates and schemes for similar positions;
and (d) non-conduct of performance evaluation prior
to renewal of contracts
5 R5 CSU Appointments issued to two teaching personnel 0.16
invalidated by the CSC due to non-compliance of
approved DBM Notice of Organization, Staffing and
Compensation Action (NOSCA) resulting in a
disallowance
6 PSU Non-institution of legal action against the two 0.61
employees, grantees of postgraduate scholarship in
New Zealand Agency for International Development
(NZAID) and Bar Examination review, for breach of
contract, in order to recover the amount spent for
them, contrary to certain provisions of the Study
Leave Contracts
TOTAL 78.77
Other observations which are contrary to existing CSC and other issuances
relative to Personnel were reported in 10 agencies although these transactions
were not quantified:
1 C2 PSA Hiring of 428 JO workers for CY 2017, some of whom were

performing tasks/functions which are part of the job description of
the existing regular employees; qualified JOs not given priority in
the hiring for regular positions
2 C5 PNU PNU–Mindanao continually allowed its regular employees to receive
monthly net take home pays less than the PhP4,000.00 threshold
3 TUP Payment of daily wage compensation to 37 contractual personnel of
TUP Manila and Taguig was not leveled up to the new minimum
daily wage for workers in the NCR; and gratuity pay to JO and COS
workers was not granted in TUP Manila contrary to Administrative
Order No. 02 issued by the Office of the President
4 C6 POPCOM JO personnel were allowed to perform the functions of existing
regular employees in POPCOM-CO which is not in accordance with
Section 7.2 of CSC COA DBM Joint Circular No. 1 s. 2017; and
eight COS/JO employees of RO VII were allowed to attend the
agency’s 48th National Convention Anniversary in Tanay, Rizal on
February 20-24, 2017, contrary to Memorandum No. 2016-461
which only encouraged all regular national and regional POPCOM
staff to attend the event
5 C7 DOT The number of individually contracted JO/COS personnel increased
by 74 or 28.79 percent from 257 employees in CY 2016 to 331 in
CY 2017 notwithstanding the end of transitory period for the renewal
of individual contracts of JO workers is on 31 December 2018 as per
CSC-DBM-COA Joint Circular No. 1 series of 2007
6 CAR BSU JO personnel with the same position titles were accorded varying
rates while others were given rates below or not within the set pay
scales contrary to University guidelines
7 ASC Monthly net take home pays of various employees of the College
were lower than the required minimum amount of PhP4,000.00
8 R6 UA CSC policies on habitual tardiness and undertimes were not strictly
imposed by Management resulting in perennial tardiness and
undertimes to the detriment of public service
9 R8 SLSU Net take home pay of 63 employees of the SLSU below the
minimum threshold of PhP4,000.00
10 R11 MinDA Revised Organizational Structure lacked the approval of the proper
authorities contrary to Section 82, GAA for FY 2017 and pertinent
428
provisions of RA No. 9996
6. Internal Control Deficiencies

Amount
(in M PhP)
1 C6 POPOCOM The Procurement System of RO IV-A showed 2.11
control weaknesses brought about by non-
compliance with existing rules and regulations;
thus, affecting the objectives of COA Circular Nos.
97-002 and 2012-001.
2 C7 DOT Frequent sponsorships made by the DOT-CO to 19.55
Non-Government Organizations (NGOs)/ People’s
Organization (POs) for CY 2017 necessitates the
issuance of specific guidelines to ensure the strict
observance of measures that will prevent excessive
and unnecessary grant of financial assistance
There are no specific guidelines on foreign travels 19.29
by the DOT-CO personnel, with traveling
allowances aggregating to PhP19.29 million in CY
2017
The PAPs of DOT under its MFO 1 Activity 3 and 847.21
locally funded projects, with a total appropriation
of PhP847.21 million have no specific indicators
that will directly measure the performance of each
PAPs
No monitoring and evaluation was conducted on 605.26
the PAPs of the 12 foreign Philippine Tourism
Offices (PTOs), which received cash advances of
PhP605.26M for CY 2017; there was no proper
oversight body or person/s designated to conduct
said functions including the responsibility to keep
the reports provided by PTOs contrary to Section
12c., Chapter II, RA No. 9593 and Section 11c and
Section 21a.5, paragraph 2, Rule II Chapter I, of its
Implementing Rules and Regulation
3 DOTr Due to insufficiency of evidence, 41 percent of the 18.03
195 cases of alleged colorum violations reported in
DOTr-CAR in CY 2017 were either dismissed or
downgraded to other land transport violations
resulting in lost income for the government; the
accessory penalty of minimum three months
impounding period prescribed for colorum
violation was not strictly imposed contrary to
DOTC Joint Administrative Order (JAO) No.
2014-01
TOTAL 1,511.45
Unquantified deficiencies related to internal control were reported in six

agencies:
1 CAR BSU The Internal Audit Services' operational plans not aligned with the
activities mandated by regulations; internal audit reports not
consistently included in the University Annual Reports contrary to
rules
2 R6 CSU Lack of implementing guidelines or specific policies on provision
of shuttle service for employees
3 UA Management failed to organize an Internal Audit Service/Unit

4 R9 JRMSU The Main and Dipolog Campuses have not yet organized the
Internal Audit Service (IAS) as required under Chapter 4, Section
124, PD No. 1445 and Administrative Order (AO) No. 70, s. 2003
dated 14 April 2003
5 R10 CMU The system on the issuance of Charge Invoice (CI) for farm
429
R10 products sold on credit is deficient and lack internal control
mechanisms thereby susceptible to errors and on extreme cases,
fraud
6 MSU-LNAC Failure of the management to establish internal controls in
managing the financial transactions and separating duties of
employees to avoid conflicts of interest or opportunities for abuse
contrary to Section 123, PD No. 1445
7. Other Transactions Violative of Laws/Pertinent Issuances

Amount
(in M PhP)
1 C2 BOC Two “Once-A–Year Importers” were able to import 6.30
items amounting to PhP6.295 million despite non-
submission of valid Import Authority
2 PSA PSA and the Concessionaire have not opened an 134.98
escrow account for the CRS-ITP2 Concession
Agreement, in violation of DOF-DBM-NEDA-
BOT Center JC No. 03-01, series of 2003, and
Section 9.3 of the Concession Agreement dated 30
September 2016
3 PS-DBM PS-DBM distributed in CYs 2013–2017 a total of 61.32
PhP61.322 million as profit share to different depot
from the income that accrued to the Revolving
Fund, from which PhP19.919 million were utilized
without authority from the GPPB and without
consideration of the restrictions in the use of
‘Revolving Fund’; the Guidelines on: (i)
Income Sharing; (ii) Depot Giveaways; (iii) Loss of
Assets; and (iv) Allowances, provided for under the
Manual, are inconsistent with the existing laws,
rules and regulations
4 C5 PUP Administrative costs amounting to PhP1.644 1.64
million or PhP500.00/grantee/semester were
deducted for every processed claim of scholarship
grant, and transferred to Fund 164 account as
agency’s miscellaneous income depriving the
student-grantees of the benefits due them
5 C6 NPC Had the NPC enrolled and entered into MOA with 0.09
PS-DBM Government Fares Agreement (GFA) on
the procurement of airline tickets for local travels
of its officials and employees, the agency could
have at least generated PhP0.086 million savings
such as discounted airfares, processing fees,
rebooking fees, and additional baggage allowance,
among others
6 C7 DOT The MOA between the DOT and The People’s 89.88
Television Network, Inc. (PTNI) and/or PTV
showed a possible conflict of interest, considering
that as per approved media plan PhP89.878M or 75
percent of the computed contract cost will be paid
to the program Kilos Pronto, under the company
owned by the brother of the DOT Secretary, among
others
7 DPWH Payments made by DPWH-OSEC, Regions I, V, X, 75.36
XI and XIII to Road Right of Way (RROW)
claimants affected by the implementation of
various infrastructure projects not in accordance
with the provisions of RA No. 10752, COA
Circular No. 2012-001 and other relevant laws,
rules and regulations
8 DOE DOE's Conventional Energy Resources 424,742.55
Compliance Division (CERCD) did not perform its
mandatory audit of the books and accounts of Shell
Philippines Exploration B.V. (SPEX), the
contractor of the Malampaya Natural Gas Project,
within the prescribed period provided for under SC
430
7. Other Transactions Violative of Laws/Pertinent Issuances
C7 No. 38, casting doubt on the accuracy of the
reported government shares for CY 2002-2017 of
PhP424.74 billion
DOE's non-monitoring of the enforcement of the 8.74
Program Implementation Agreement (PIA)
provisions by the Environmental Program and
Management Department (EPMD) and the Trust
Banking Group (TBG) of the Land Bank of the
Philippines (LBP) resulted in the default of loan
payments amounting to PhP8.47 million by two
loan borrowers; validation and complete review of
the extent of the compliance of EPMD and TBG
vis-a-vis the Operating Manual could not be
undertaken due to non-submission of the required
documents
TOTAL 425,120.86
One unquantified audit observation was reported on BTr pertaining to various

approved and/or paid fidelity bond applications in several TPOs in RO I which
were not fully compliant with the requirements under relevant BTr issuances
thus, affecting the validity of fidelity bond transactions.
7.4.30 The Auditors recommended that concerned officials and employees,

among others:
7.4.30.1 Require the Accountant to make the necessary restatement of the

financial statements and adequately disclose the effects of the prior
period errors and adjustments in the Notes to FSs pursuant to
pertinent provisions of PPSAS No. 3.
7.4.30.2 Strictly monitor Agency’s compliance with COA Circular No. 2013-
004 and other COA issuances, particularly on: (a) submission of a
complete list of completed, on-going and for implementation during
the year government projects/programs/ activities (PPAs) at the
beginning of each calendar year; (b) notify in writing the Office of
the Auditor within 10 days after the award of the infrastructure
project or before the start of the program/activity informing that the
appropriate project signboards and/or public notices are already
posted; (c) use of the prescribed forms presented as “Annex A” of the
Circular, and (d) posting of prescribed billboard in the location site,
and the agency’s transparency seal in the website.
7.4.30.3 The Accounting Office to ensure that the Agency maintain a

complete set of books and registries for fair presentation of the FSs;
comply with the GAM provisions on reportorial requirements,
recording of transactions as they occur and posting the same to the
respective ledgers monthly, submission of copies of the JEVs on
transactions/adjustments to COA, and use of accounting system
compliant with COA e-NGAS requirements. On the other hand, the
Budget Office to faithfully observe the obligation process,
recognizing the full amount of commitments against the allotment/
appropriations source and ensure the availability of the fund sources
for the settlement of such commitments; and ensure that obligations
431
shall be incurred only on the basis of valid claims supported by
sufficient documentary evidence.
For SUCs: (a) prepare a well-planned and realistic annual STF

Budget to be presented to the Board of Trustees (BOT), considering
the needs and absorption capacity of the College to disburse the
same; (b) maximize budget utilization and monitor closely the timely
accomplishment of planned programs/projects; (c) ensure accuracy in
reporting of financial accountabilities, particularly the utilization of
fiduciary from non-fiduciary funds; and (d) submit BOT Resolution
duly signed by the Chairman and the members, if required/necessary.
7.4.30.4 Implement programs, projects or participate in any disaster activities

conducted by various organizations from local or national level in
compliance with Section 35 of the FY 2017 GAA as well as RA No.
10121 or the Philippine Disaster Risk Reduction and Management
(PDRRM) Act of 2010.
7.4.30.5 Consider the recommendation on the filling-up of vacant

plantilla positions instead of hiring JOs or COS workers; and limit
the hiring of JOs in accordance with Item No. 7 of CSC, COA and
DBM Joint Circular No. 1, series of 2017. Moreover, refrain from
assigning the tasks of regular personnel to the JOs/COS. In the case
of the employees’ net take home pay, strictly comply with the
general provisions of the GAA.
For SUCs: (a) hire JOs and set the salary scales of these personnel in
accordance with the approved University Guidelines; (b) institute
necessary legal action against the two scholarship grantees who
breached their scholarship contracts; (c) require the refund of the
salaries and other benefits of the two teaching personnel whose
appointments were invalidated by CSC.
7.4.30.6 Create an Internal Audit System (IAS) and ensure that the Annual
Operational Plan activities shall be aligned with those identified
under Administrative Order (AO) No. 278 in order to achieve the
avowed purpose of making government systems and processes
effective and responsive, as well as managing public resources
efficiently. For SUCs, the summary of IAS reports shall be included
in the University Annual Report pursuant to AO No. 70.
7.4.30.7 For BOC, investigate thru confirmation the authenticity of the

documents issued by the government entities; take appropriate action
against those concerned for violation of relevant BOC rules and
regulations on accreditation and importation of vehicles; and initiate
forfeiture/seizure proceedings against the subject imported vehicles.
7.4.30.8 PSA to coordinate with the DOF and other concerned agencies for the
purpose of opening an escrow account for the CRS-ITP2 project.
432
Instruct all Collecting Officers to deposit all CRS collections to said
account.
7.4.30.9 PS-DBM to stop the distribution of profit share to depot/sub-depot in

the absence of legal basis and GPPB approval; ensure that only
eligible expenses necessary for the operation of the depots are
approved for distribution and incurred without violating the rules in
the use of Revolving Fund.
7.4.30.10 For DOT, submit the required and necessary supporting documents in
compliance with the MOA, COA Circular No. 2012-001 and Section
4, PD No. 1445, including the justification of PTV on its non-
compliance with the MOA and the approved media plan, in order to
make the necessary evaluation on the inconsistencies noted, among
others.
7.4.30.11 DPWH to: (1) direct its Accountant to comply strictly with the
submission of documentary requirements supporting the payment of
RROW acquisition under Section 13 of COA Circular No. 2012-001
and Section 2.23, Item D of DPWH ROW Acquisition Manual;
(2) assign a responsible officer to check, ascertain, and ensure the
completeness of the supporting documents in the payment of ROW
claims; and (3) ensure that modes of payment expressly authorized
by law are followed.
7.4.30.12 DOE to fast track the audit of Service Contract No. 38 covering
CYs 2014 to 2017 and formulate immediately the guidelines on the
conduct of audit of all service contracts, including the policies on the
settlement of exceptions; revisit Section 15.2 of the contract and
amend, if deemed necessary; and in the case of PIA, enforce the
provisions by exerting extra effort to collect from the defaulting
borrowers the outstanding principal loans and corresponding
penalties, among others.
7.4.31 Non-observance by a number of agencies of certain laws, rules and

regulations defeating the purpose for which these were enacted and may
result in wastage of government funds.
No of Amount
Condition Laws/Rules violated
Agencies (in M PhP)
Non-submission of the required monthly/ PD No. 1445 and 93
quarterly/ annual financial reports and COA issuances, COA-
supporting schedules, disbursement vouchers DBM JC No. 2014-1
(DVs), Official Receipts (ORs), Bank
Reconciliation Statements (BRSs), among
others within the prescribed timeline
Non-submission of copies of perfected COA Circular No. 36
contracts/ MOAs/ Purchase Orders/Job Orders, 2009-001 dated 12
etc. within the given timeline February 2009
Non-compliance with Senior Citizens and RA No. 10924 or FY 56
Differently-Abled Persons provisions 2017 GAA, DBM-
DSWD JC No. 2003-
01
433
No of Amount
Condition Laws/Rules violated
Agencies (in M PhP)
Non-compliance with Gender and Development FY 2017 GAA,
(GAD) requirements, among others: PCW/NEDA/DBM JC
a) GAD Budget less than five percent of the No. 2012-01, other 52
total agency appropriations; PCW Issuances
b) Non-preparation/submission of GAD 19
Plan/Budget (GPB), or non-conformity with
the guidelines on GPB preparation;
c) Annual GAD budget for CY 2017 not fully 46
utilized, or partial accomplishment of GAD
Plan;
d) Non-adoption of GAD Focal Point System, or 9
non-compliance with the elements of gender-
responsive system;
e) GPB not submitted/ endorsed to PCW/DBM, 28
or reviewed by PCW for various reasons;
f) Non-submission of GAD Accomplishment 16
Report and its supporting documents; and
g) GAD funds utilized for other purpose. 1
Non-compliance with BIR provisions on NIRC of 1997, RA
withholding of taxes and other deficiencies No. 8424 PD No.
noted: 1445, EO No. 651, 30 834.744
a) Delayed remittance of taxes withheld Revenue Regulations
(current and prior years)
b) Over-remittance of taxes 1 0.120
c) Unrecorded remittances/Erroneous 2 7.093
recording
d) Tax balances for verification 1 1.655
e) Taxes not withheld/deficiencies in 11 15.386
withholding tax
f) Negative balances of Due to BIR account 3 2.476
Non-compliance with provisions of GSIS law: RA No. 8291 or GSIS 41 1,356.064
a) Failure to deduct or unremitted GSIS Act of 1997
contributions or unreconciled GSIS account
balances
b) Negative account balance 1 0.015
Non-compliance with Pag-ibig Law provisions: RA No. 9679 dated
a) Non-deduction of premium/unremitted 01 June 2009 17 21.252
contributions
b) Over-deduction of contributions 2 0.682
c) Over-remittance of contributions 1 0.136
d) Account balance for verification/ 4 3.716
reconciliation
e) Negative account balances 3 4.445
Delayed or unremitted PhilHealth contributions; RA Nos. 10606 5 0.094
Over-remittance/overpayment of contributions (2013)/ 7875(1995), 4 0.299
Philhealth Circular
No. 0001-2014/Other
Issuances
Unsettled Disallowances at year-end RRSA under COA 77 9,305.768
Circular No. 2009-006 40 404,623.501
Unsettled Suspensions at year-end
Unsettled Charges at year-end 7 146,828.902
7.4.32 The Auditors recommended, among others, that concerned Agency officials:
a) Strictly comply with the provisions of existing laws such as the GAA
on GAD, Senior Citizens, and Differently-Abled Persons, BIR, GSIS,
Pag-IBIG, PhilHealth and various rules/regulations/issuances
particularly issued by COA, among others; and ensure accurate
434
computation of the premiums as well as timely and full remittance of the
mandated contributions/taxes.
b) Enforce the settlement of the disallowances, suspensions and charges

within the period prescribed in the Revised RRSA or request for
installment settlement in accordance with COA Resolution No. 2015-
031, so that once approved, staggered payment through salary/payroll
deductions may be implemented by the agencies.
435
7.5 Consolidated Common Audit Observations Affecting the Fair Presentation
of Financial Statements (FSs) for Calendar Year (CY) 2017 of NGAs
as discussed in the Annual Audit Reports
7.5.1 Cash
Cash account balances in a number of agencies are unreliable/doubtful due

to reported cash shortage/failure to deposit collections, unrecorded
collections and disbursements, erroneous recording of entries,
unaccounted/unreconciled variances and unrecorded reconciling items,
among others; hence, exposing government funds to possible
misappropriation, misuse and losses.
7.5.1.1 Cash shortages in four agencies amounting to PhP34.791 million mainly

caused by non-restitution of 11 erring Accountable Officers (AOs), and
other weaknesses in internal control resulting in misuse or loss of
government funds.
Cluster/ No. Amount
Agency Remarks
RO AOs (in M PhP)
C3 SCP 8 Cash shortages of AOs due to inability of 32.414
Management to enforce restitution contrary to
Section 37 of PD 1445
C4 NBI 1 Discrepancies noted in audit due to the failure 0.002
of Collecting Officer in Region III, Olongapo
District Office to total, foot and reconcile
transactions on collections and deposits in the
record book
C5 UPS 1 Cashier V's net cash shortage committed by a 1.733
Collecting Officer under her supervision
C7 MARINA 1 Cash shortage due to inadequate monitoring 0.642
and supervision by the supervisor
TOTAL 11 34.791
7.5.1.2 Collections of 94 AOs in 23 agencies amounting to PhP159.763 million

and in six agencies with no amount or number of AOs, were not
deposited intact the next working day and other lapses in internal
control increase the risks of misappropriation or loss of government
funds.
Cluster/ No. of Amount

Agency Remarks
RO AOs (in M PhP)
C1 OPAPP 1 Cash collected in February 2016 not deposited 0.223
to MPDLG account in the Philippines as of 31
December 2017
NPO 7 Deficiencies and irregularities on handling of 94.92
collections include: a) various collections not
deposited intact/immediately, (b) alteration of
date of OR, and (c) excessive number of
designated Collecting Officers (COs).
C3 SCP 25 Special Collecting Officers (SCOs) did not 0.175
remit their daily collections intact or regularly
to the bank
436
Agency Remarks
RO AOs (in M PhP)
C4 NBI 1 In Region II, Bayombong District Office, the 0.067
SCO did not remit/deposit intact her daily
collections from March 27 to July 14, 2017 or
69 days
C5 DepEd 3 Collections were either deposited in the 0.828
personal account of the Principal/not
deposited intact/daily resulting in the
accumulation of cash in the custody of the
Cashier.
NCCT 1 Collections made on 31 March 2017 were not 0.996
deposited intact by the Collecting Officer
within the prescribed period
PNU 1 Collections of PNU–Mindanao and PNU- 0.340
South Luzon not deposited intact daily and
regularly with an average of two to nine
banking days in the possession of the AO
PUP 4 Collections of four Collecting and Disbursing 2.247
Officers (CDOs) not deposited intact daily or
within the next banking day, thus incurring
delays ranging from two to 11 days.
DOLE 25 Undeposited collections by various Collecting 11.019
Officers, of which 25 AOs are from Philippine
Overseas Labor Offices (POLOs), were not
deposited intact daily and at year-end in
violation of the provisions of DOLE/DFA/
DBM/DOF/COA Joint Circular (JC) No. 3-99
dated 28 September 1999 and GAM for NGAs
NLRC 1 RAB X collections for both the General and 0.448
Trust Funds were not deposited intact daily
and kept by the Collecting Officer
C6 DICT 1 The Cashier in the FOO, Mindanao Cluster 1 2.035
failed to deposit his collections intact and
daily or the next banking day with delay that
ranged from 1 to 285 days
C8 PHILFIDA 1 Delayed deposit of collections 0.167
CAR BSU 1 Cash collections were used to fund daily 0.117
operational expenses.
R3 NEUST 4 Four AOs from IGP-Marketing and Training 3.712
Center (Main), San Isidro, Atate, Fort
Magsaysay and Gabaldon Campuses, did not
deposit their collections intact and daily on
some occasions; significant amount of cash
remained in the custody of Accountable
Officers at the end of each day which have
reached to as high as PhP3.712 million in the
case of the Collector at Gabaldon Campus,
which remained undeposited for four days
R4A SLSU 1 Collections of SLSU-Tiaong and various 7.027
Campuses not remitted regularly and intact
daily
R5 CNSC 1 Collections not remitted intact daily due to 0.241
dual assignments by the Collecting Officer at
Abaño and College of Business and Public
Administration (CBPA)-Main Campus
resulting in an average delay of six days per
month or PhP0.241 million contrary to
Appendix 26 (d), Report of Collections and
Deposits of the GAM, Volume II
437
Agency Remarks
RO AOs (in M PhP)
R6 ISCOF 1 Collection of tuition fees and other school fees 9.49
of ISCOF Dumangas Campus were not
deposited intact and regularly in its AGDB;
the Cashier failed to maintain Cash Receipts
Record (CRR) to record collections and
deposits of the agency thus, cash balance
cannot be determined immediately.
R7 CNU 2 Collections of the accountable officer totaling 0.380
PhP0.38 million not reported and deposited
immediately in the next banking day
Receipted moneys not deposited intact 4.760
SSC 1 Collections during the last day of CY 2016 0.203
under the Special Trust Fund (Fund 164),
reported as funds “already deposited” as at
year-end even if said collections were only
deposited in January 2017; the amount
collected was not deposited intact.
CTU 1 Undeposited collections of CTU Main 4.613
Campus as of 2 February 2017 under the
accountability of the Supervising
Administrative Officer (Cashier IV) remained
not deposited as at year-end
1 Undeposited collections of the deceased AO 1.234
of CTU Danao Campus recorded as Other
Receivable account
1 Delay in the deposits of collections of CTU 2.396
San Francisco Campus ranging from 3 to 19
days
R8 VSU 1 Collections of VSU-Pavilion/Guesthouse, an 0.392
IGP not remitted intact and daily by the
designated IGP-Manager to the VSU Cashier
6 Collections from IGPs not remitted to the 0.077
Collecting Officer daily and intact, resulting in
delayed recognition of income
R9 BSC 1 IGP Collections remained undeposited 0.317
R10 MSU- 1 Weak internal controls in handling receipts 11.339
LNAC and collections such as: a) the collections not
deposited intact and on time, b) non-
reconciliation with accounting records, and
c) service charges debited to accounts
TOTAL 94 159.763
Transactions pertaining to collections not deposited intact were noted in other

seven agencies although the amounts related thereto were not determined:
Cluster/ No. of
Agency Remarks
RO AOs
C1 DFA 2 Collections of US$16,905.00 from consular services rendered
for the period under audit were not deposited in full amount
the following banking day to the depository bank
8 Delayed remittance of collections and submission of monthly
FRs by HCs to Post resulted in the delayed recording of HC
transactions in the books.
2 Collections in RCO Lipa City and Lucena City during
holidays and weekends not deposited intact and regularly
C3 COMELEC 147 Collections of Election Officers (EOs) in the NCR, CAR,
Regions II, III, IV-A, V, VI, VIII, XI and XIII not deposited
within the prescribed period, as delays ranging from 1 to
1,021 days were incurred
438
Cluster/ No. of
Agency Remarks
RO AOs
C3 SCP Not Absence of details as to Special Collecting Officers (SCOs)
stated accountable for the undeposited collections
C4 LRA 9 Nine Collecting Officers (COs) of various Registries of

Deeds (RoDs) failed to deposit their collections daily and
intact and/or not later than the next banking day with the
Authorized Government Depository Bank (AGDB)
PPSC Not Delay ranging from one to 11 days in the deposit of
stated collections
C5 TESDA 4 Collections ranging from PhP2,100.00 to PhP7,897,799.70 in
Regions I, V, VI and XII were not deposited intact on a daily
basis or not later than the next banking day.
R12 SKSU 10 Cash Collections of 10 accountable officers not deposited
intact
7.5.1.3 Unrecorded/unreported or delayed recording of collections, bank

deposits, refunds, and fund transfers as well as disbursements or
withdrawals, among others, were noted in 27 agencies amounting to
PhP4.358 billion made the cash account balances at year-end unreliable.
Amount
Cluster/RO Agency Condition/Reason
(in M PhP)
C1 DDB Receipt of NCA as Special Fund for drug 460.360
rehabilitation activities and the remittance of
related collections in excess of the amount allowed
to be utilized for the purpose were not properly
taken up in the books
C2 NEDA CO Unrecorded payments/recovery from reneging 0.141
scholars; checks received but returned due to full
implementation of the Check Image Clearing
System of Philippine Clearing House Corporation.
TC Collections of performance securities not issued 0.088
ORs, thus, not recognized in the books of accounts
PS Non-recording of bank credits; transactions 65.332
credited to PS main bank account
BIR Unrecognized refund of advances to PS-DBM 3.293
C3 SCP Delayed recording of collections and deposits of 1,826.034
respectively
Unrecorded collections and deposits of PhP917.729 917.729
million; and unreported deposits of undetermined
amount caused by delayed/non-submission of
RCDs by SCOs nationwide
COMELEC Disbursements made in CY 2016 remained 8.554
unrecorded as at January 31, 2017
C4 AFP-GHQ Unrecorded opening of Letter of Credit for the 139.140
Intelligence, Surveillance and Reconnaissance
Capability Upgrade Project in the books of
accounts
BI Unrecorded four bank accounts maintained at the 11.776
LBP
PCGG Unrecorded withdrawal of US$5 million resulted in 251.985
the overstatement of the Cash-in-Bank (CIB)-
Foreign Currency Account (FCA)
C6 NNC Unrecorded cash disbursements of NNC-RFOs 404.180
NTC Unrecorded collections and remittances 0.03
SEI Unidentified bank deposits from scholars remained 2.718
as reconciling items in BRSs and unrecorded in the
books
439
Amount
Cluster/RO Agency Condition/Reason
(in M PhP)
C6 DOST Unrecorded deposit in the books as of 31 0.450
December 2017 due to the non-identification of the
Source Agencies (SA) of the project funds
deposited in the CIB-Local Currency Current
Account (LCCA) of DOST RO V
ICAB Unrecorded collections thru bank to bank transfers 11.718
due to delayed issuance of certification by the BTr
JJWC Non-recording of a deposit/receipt brought about 0.215
by the failure of the accounting to prepare BRSs
C8 EMB Failure to record the over deposit/remittance made 0.007
covering the period January 2013 to 13 September
2017 by EMB Region IX
NWRB Unrecorded disbursements from ASEAN Plus 2.867
Three Cooperation Fund
DA Various unrecorded cash transactions 15.769
MGB Failure to record the deposited refunds on cash 0.026
advances to BTr by MGB Region V
DENR Unrecorded collections and book reconciling items 9.823
of cash accounts
NMIS Unrecorded cash deposit from India for the 1.119
expenses of the DA - Inspection Mission (DAIM)
team for Foreign Meat Establishment accreditation;
the cash was directly deposited to the bank account
of NMIS on 28 July 2017
Unrecorded collections and deposits by the 1.178
Regional Field Offices
R2 ISU Unrecorded deposits and withdrawals made under 15.490
LBP Account - ISU Arzadon Scholarship Fund of
the University and unsubmitted to COA for audit
Unrecorded fund transfers at year-end 12.016
R4A SLSU Cash collected from different school fees was 18.226
improperly recorded and deposited under the
Income Generated Project (IGP) account and
other accounts under LBP Account No. 3652-
1000-49.
R5 CBSUA Unrecorded and undeposited collections 0.212
R7 CTU Recorded transactions in the Cash Receipt Journals 0.045
(CRJ) not based on the amount collected by the
Cashier per ORs issued and as reported in the
Report of Collections and Deposits (RCD) of the
San Francisco Campus
Failure to record several loan payments from the 0.011
Campus’ Small Farm Entrepreneurship Loan
Program by CTU Barili Campus
Unrecorded receipts and utilizations of the fund of 5.770
CTU Carmen, Moalboal and Tuburan Campuses
maintained with the AGDB
Unrecorded payments for the CTU Barili’s Small 0.102
Farm Entrepreneurship Loan Program due to non-
issuance of official receipts and non-remittance to
the Accounting Office
R12 USM 22 bank accounts, under the external projects 171.625
and/or funds received from source agencies not
properly taken up in the books of the university and
corresponding receipts, disbursements and
reconciling items were unrecorded
TOTAL 4,358.029
Unrecorded/delayed recording of cash transactions were in reported in two

other agencies although amounts were not established.
440
3 SCP Unreported collections and deposits of undetermined amount
caused by delayed/non-submission of Report of Collections and
Deposits (RCDs) by some SCOs nationwide.
COMELEC Five hundred nine (509) checks drawn from the Cash –MDS
account in CY 2016 which were reported in the Report of Checks
Issued (RCI) prepared by the Data Processing Division (DPD)
unrecorded in the Check Disbursements Journal (CkDJ)
maintained by the Accounting Division (AD) due to incomplete
submission of the DVs and their supporting documents
7.5.1.4 Accuracy of cash balances of various agencies at year-end were

doubtful due to non-preparation or delayed bank reconciliation
statements, unaccounted variances between book and bank
balances, GL and SLs or Accounting and Cashier’s records, unrecorded
reconciling items, among others.
a) Unreliable cash account balances at year-end amounting to

PhP25.443 billion in 26 agencies due to non-preparation/delayed
preparation of bank reconciliation statements (BRSs)
Cluster/ Amount
No. Agency Condition/Reason
RO (in M PhP)
1 C1 NYC Non-preparation of BRS 0.278
2 C2 PET Delayed/non-submission of the monthly BRSs 75.747
3 SCP Delayed submission of BRSs to prove the 16,766.985
correctness of some savings accounts
amounting to PhP15,721.420 million
4 C3 BJMP BRS not prepared and submitted within the 4.487
reglementary period delaying the audit of the
accounts
5 C4 PPSC Non-preparation of BRS hence, non- 118.226
reconciliation of book balance with the bank
balance
6 C5 PUP Delayed/non-submission of monthly BRS at 512.838
year-end resulted in unreconciled net variance
between bank and book balances
7 CHED Non-preparation/delayed submission of the 605.388
monthly BRSs in CHED-CO and four
CHEDROs
8 TESDA Non-preparation and/or late submission of 2,854.292
BRS by the Central Office, NCR, and Regions
III, V, VI, XI and XII
9 C6 POPCOM Balances of the Cash in Bank, LCCA/MDS in 1.664
RO V & VIII accounts at year-end unreliable
due to lack of reconciliation with bank
records
10 C7 NPDC Non-preparation of BRSs 7.561
11 C8 ACPC Unreconciled discrepancies between the Cash 688.115
in Bank accounts and the bank balance of the
agency due to non-submission of BRS
12 R2 BSC Non-preparation of monthly BRSs 12.862
13 ISU Non-submission of BRSs for Cash in Bank 315.673
14 CSU Non-preparation of monthly BRSs in other 344.622
campuses
15 QSU Non-preparation of BRS resulting in a 35.338
discrepancy of PhP11.709 million between the
actual bank balances and the financial
statement balances
441
Cluster/ Amount
RO (in M PhP)
16 R2 NVSU Non-preparation/submission of BRSs 208.723
17 R3 PSAU Late submission of BRSs with all supporting 139.463
documents and Journal Entry Voucher, as a
result of lack of manpower
18 RMTU Unreconciled balance per book and balance 42.344
per report of Authorized Government
Depository Bank; and untimely submission of
BRSs
19 R4A CSU- Non-preparation of BRS resulted in the 893.820
Main material discrepancy between the balances per
Campus bank confirmation of 21 accounts maintained
at the LBP amounting to PhP925.872 million
as against accounting records of PhP893.825
million
20 SLSU Delayed preparation/submission BRSs and 395.089
unadjusted reconciling items as of year-end.
21 R5 BU Non-compliance with the preparation and 439.300
submission of complete BRSs for the Cash in
Bank
22 CBSUA Non-preparation of the monthly BRSs by the 311.360
Accountant
23 DEBESM Non-preparation of the monthly BRSs by the 61.070
SCAT Accountant resulting in unreconciled
difference between the balance per bank and
balance per books
24 R8 VSU Discrepancy in balances between the General 509.909
Ledger (GL) and Bank Confirmation Results
due to non-preparation of Bank Reconciliation
Statements (BRS
25 ESSU Discrepancy in balances between the Cash in 80.468
Bank-LCCA (all funds) and Bank
Confirmation Results caused by non-
maintenance of subsidiary records and non-
preparation of monthly BRSs
26 R13 ASSCAT Non-submission of BRS 17.365
TOTAL 25,442.987
Delayed or non-submission/preparation of BRSs were also observed in

three other agencies with no reported amounts:
1 C1 NCIP Delayed/non-submission of monthly BRS of RO Nos. IX

and X
2 HLURB Failure to timely submit the BRS
3 C4 PNP BRSs not prepared/submitted within the required period in
some PROs resulting in delay of audit of the agency’s cash
account
b) Unadjusted transactions, discrepancies or delayed recording of

reconciling items resulting in doubtful cash accounts at year-end in
38 NGAs amounting to PhP2.286 billion
Cluster/ Amount
RO (in M PhP)
1 C1 NPO Unadjusted/uncorrected reconciling items 17.146
2 DFA Unadjusted reconciling items - Unrecorded 4.578
deposits; Automatic bank transfers; Bank
Errors
442
Cluster/ Amount
RO (in M PhP)
3 C2 BIR Difference with the confirmed bank balance of 19.616
Cash in Bank (CIB) – Local Currency, Current
Account (LCCA)
Unrecognized Dishonored Checks (DCs) 110.718
4 PS Bank debits comprised of dishonored checks 55.986
issued by clients are not recognized/
accounted for in the books
5 C3 PET Unadjusted reconciling items in the BRSs 0.002
6 SCP Discrepancies between the balances of the 404.741
bank accounts per books and per bank
Discrepancies between the balances per books 500.694
and per bank of various savings accounts
Unadjusted book reconciling items in the 487.128
BRSs
7 C4 DILG Unadjusted book reconciling items and 0.006
accounting errors
8 LGA Unrecorded bank deposits in the books since 0.332
nature of bank deposits amounting could not
be identified
9 BJMP Bank reconciling items dated from CY 2004 0.092
to CY 2016 requiring adjustment by the bank
(net understatement) still not adjusted by the
bank
10 NDCP Stale still accounted as outstanding checks 0.034
while bank interest remained unrecorded
11 AFP- Unrecorded/unidentified bank debit and credit 240.532
GHQ memos and other reconciling items remained
unadjusted as at year-end resulting in
unreconciled balance between Subsidiary
Ledger (SL) and bank confirmation reply
Unidentified/unrecorded reconciling items 175.697
appearing in the BRS but not recorded in the
books due to the absence of supporting
documents to determine the nature of the
transactions
12 PA Unrecorded reconciling items 9.116
Cancelled List of Due and Demandable 1.122
Accounts Payable - Advice to Debit Account
(LDDAP-ADA)
13 PN Various unadjusted reconciling items in the 25.328
BRS of Integrated Payroll Management
System (IPMS) Bank Account No. 3, resulting
in net overstatement
14 DOJ Unadjusted reconciling items 33.458
15 BI Unrecorded/unadjusted reconciling items 0.746
16 OSG Unadjusted deposit in transit 0.062
Erroneous entries in the books 0.014
17 C5 CHED Unrecorded book reconciling items in CHED- 0.154
CO
18 NM Unadjusted prior years’ book reconciling 7.615
items have been periodically reported since
year 2010 resulted in the net overstatement of
the CIB – LCCA account
19 C6 DOST Unsubstantiated reclassification and an 0.049
unrecorded disbursement by DOST CO
Reconciling Item-unrecorded deposits in the 16.497
books of RO XI
Items requiring adjustments-errors which 0.053
overstates the book balance in RO XI
443
Cluster/ Amount
RO (in M PhP)
C6 Reconciling Item -errors which understates the 6.326
book balance in RO XI
20 SEI Unadjusted net book and bank reconciling 2.821
items of PhP2.718 million and PhP0.103
million respectively, due to lack of pertinent
information and supporting documents.
Unidentified deposit in transit which represent 0.292
carried over balances in BRSs since January
2015
21 C7 DOT Bank credits/debits not recorded in the books 67.064
22 MMDA Various prior years’ reconciling items which 0.117
remained unadjusted as at year-end
23 DPWH Unrecorded payments, lapsed cash allocations 5.960
and fund transfers, and other book reconciling
items which overstated the cash accounts
24 C8 NMIS Unadjusted book reconciling items 2.257

25 RO2 ISU Unrecorded book reconciling items amounting 16.016
to PhP4 million and unrecorded FTs of
PhP12.016 million at year-end
26 RO 3 BSU Improper recording and unadjusted 32.553
reconciling items in the BRSs such as
unrecorded deposits, fund transfers,
debit/credit memos, stale checks, cancelled
checks and liquidations of petty cash fund
27 PCC Failure to make the necessary adjustments for 1.030
several reconciling items; and some
unsupported and undocumented reconciling
items
28 RO 4A PCAA Unadjusted book reconciling items 0.140
RRD
29 RO 6 UA Uncorrected errors and other reconciling items 11.658
resulting in understatement of book balances
and overstatement of bank balances
30 ISTU Long outstanding book and bank reconciling
items in BRS of Main Campus not
verified/validated and adjusted in the books
Net book reconciling items 0.286
Net bank reconciling items 0.168
31 CSU Reconciling items not verified and unadjusted 8.409
32 RO 8 NwSSU Discrepancies in balances between bank and 0.264
book records caused by failure to record
various reconciling items
33 VSU Failure to adjust/correct the reconciling items 14.000
in the Bank Reconciliation Statements
reported as additions and deductions of PhP14 2.811
million and PhP2.811 million
34 SLSU Unrecorded stale checks and reconciling items 0.168
35 ESSU Understatement of the Cash in Bank-LCCA 0.509
balance due to unrecorded valid reconciling
items and c) various reconciling items without
supporting details and/or supporting
documents in the BRS, both in ESSU and
bank records
36 SSU Various discrepancies in balances between 0.554
bank and book records caused by the failure to
record various reconciling items
37 R9 ZCSPC Unadjusted reconciling items (net) of 0.466
PhP0.426 million; and stale checks,
amounting to PhP0.040 million remained as
outstanding checks
444
Cluster/ Amount
RO (in M PhP)
38 R9 JRMSU Undetermined reconciling items (net) in 0.477
Dipolog Campus;
TOTAL 2,285.862
c) Unreconciled variances between records for various reasons

amounting to PhP2.159 billion in 21 agencies.
Cluster/ Amount
RO (in M PhP)
1 C1 NPO Net unreconciled amount between the 0.030
records of the Head Collecting Officers and
the Chief Accountant resulting from various
errors.
2 DFA Difference between the balance per bank 30.513
confirmation and SLs of the accounts CIB-
LCCA and LCSA of the PRF
3 C2 BIR Undocumented/unadjusted forwarded 16.388
balances of Cash – Collecting Officers
Unreconciled GL Balance against SL 1.854
balances of CIB-LCCA
Unreconciled CIB-LCCA's SL balance 8.437
against Tax Refunds Payable (its reciprocal
account)
4 C3 COMELEC Existence of unreconciled net variance 1,606.171
between book and bank balances amounting
to PhP1,319.409 million; and unreconciled
balance between GL and SL amounting to
PhP286.762 million
5 C4 BJMP Balance per cashbook for cash advances of 0.116
the Disbursing Officer under the Trust Fund
account did not reconcile with the accounting
records with zero balance
6 OSG Discrepancy between the book and bank 18.425
balances
7 C6 DOST Unaccounted difference as to its source, 3.111
purpose, and authority to maintain in the
bank account despite earnest efforts exerted
for its reconciliation by DOST RO II
Unaccounted/unreconciled balance due to 0.669
loss of files caused by Lahar at DOST RO III
NNC Unreconciled difference between GL and SL 11.880
balances
DICT Overstatement due to non-recording of 29.599
reconciling items and misclassifications
Unaccounted cash variance between book 13.321
and bank balances
8 MIRDC Unaccounted cash variance between the book 1.108
and bank balances
9 C8 DA Unreconciled balances in the Cash - 79.902
Collecting Officer, CIB- LCCA, Cash in
Bank – Foreign Currency Savings Account
and Cash – Modified Disbursement System
(MDS), Regular
10 CAR ASIST Cash in Bank – Local Currency, Savings 0.400
account (LCSA) book balance does not tally
with the Diploma in Agricultural Technology
– Bachelor in Agricultural Technology
(DAT/BAT) Fund in the custody of the Abra
Diocesan Teachers and Employees Multi-
Purpose Cooperative (ADTEMPCO)
445
Cluster/ Amount
RO (in M PhP)
11 R2 ISU Difference between the balances presented in 21.625
the books of the University and per Campus
records
12 R3 NEUST In some ORs that details in the Collection 0.000
Report differ from those indicated in the
Duplicate ORs submitted for Audit.
13 R4A CSU- Non-reconciliation of records between the 45.748
Main Cashier's Checks Disbursement Records
Campus (CkDRs) balances of PhP848.077 million
and the reported Cash in Bank -LCCA
balances per FS of PhP893.825 million
14 SLSU Reconciliation of ledger and cashbook 9.867
balances for CIB-LCCA not undertaken by
the Accounting Office and the Cashier’s
Office at least every end of the quarter
15 PCAARRD Unreconciled Cashier and Accountant’s 148.264
books of accounts
16 R5 BU Difference between General (GL) and 23.246
Subsidiary ledger (SL) for the CCIB-LCCA
17 R6 WVSU Non-reconciliation of the Accounting Unit of 0.740

long noted discrepancy between subsidiary
ledger and cashbook balances
18 CSU Reconciling items not verified and 8.409
unadjusted
19 R8 EVSU Existence of year-end balances of the Cash 77.277
Treasury/Agency Deposit, Regular; Cash-
Modified Disbursement System (MDS),
Regular and Cash-Tax Remittance Advice
which by nature, should have no balances
reflected as at year-end.
20 NMP Discrepancy in balances between the CIB- 0.082
LCCA and bank records
21 R12 USM Unreconciled amount between balance per 1.404
FS of PhP67.041 million and adjusted
balance of BRS as of 12/31/17 of PhP68.445
TOTAL 2,158.586
7.5.1.5 Cash transactions were erroneously recorded/unrecorded in

20 agencies amounting to PhP2.286 billion and abnormal/ negative
balances of (PhP1.335) billion were reported in 11 NGAs.
Cluster Amount
/ RO (in M PhP)
Erroneous Recording
1 C1 PCC Trust receipts inclusive of interest income, 2.728
received from the Foreign Commonwealth
Office for the implementation of a
project deposited at LBP Savings
Account and recognized under the account
CIB-LCCA
2 C2 BOC Erroneous reclassification and reversal 360.582
entry per JEV No. 17-01-0048 and 17-02-
0387, respectively to close Due from
Operating Units since there were no return
of fund transfer from the Ports/Sub Port.
446
Cluster Amount
/ RO (in M PhP)
C2 Double recording of payroll liquidation 30.697
(Salaries and Wages, Representation and
transportation allowance sand other
personnel benefits) for CY 2012 to 2016
under Cash in Bank-LCCA account
3 PSA CO Unrecognized cancellation of check dated 0.456
3 May 2017
4 PSRTI Erroneous/non-recording of cash 0.839
transactions, payments made directly thru
bank for seminar/training fees; unrecorded
deposits amounting to PhP0.366 million;
and deposits amounting to PhP0.473
million credited as Seminar/Training Fees
instead of Cash Collecting Officer
Under recording of fees directly deposited 0.366
with the bank; out of PhP0.839 million,
only PhP0.473 million was recorded in
Cash in Bank – LCCA
Absence of details/notification as to who 1.526
made the deposit/ payment thru bank and
for what purpose
5 BIR Non-adjustment of closed bank accounts 1.970
6 BTr-NG Double recording of collections 644.031
7 C3 SCP Erroneous deduction in the bank balance in 6.062
the BRSs -LCCA
Erroneous deductions in the bank balance 9.970
in the BRSs-LCSA
8 C4 VMMC Erroneous adjustment of unreleased checks 1.333
resulting in overstatement of three Cash-
Modified Disbursement System (MDS)
accounts
No adjustment made in the books of 0.021
accounts for staled checks drawn by the
Center for the additional payment made to
the PS-DBM
9 AFP-GHQ Misstatement due to non-existent/closed 212.757
bank accounts with balances which remain
in the SL
10 PAF Erroneous transfer to PAF ATM Payroll 133.556
account of cash intended for PAF
Commercial Claims and PAF Variable &
Collateral System
11 DOJ Double recording of fund transfer 0.157
12 BI Erroneous recording of adjustment 0.186
13 BuCor Annual Guaranteed Production Share 35.327
collected by BuCor from TADECO under
Joint Venture Agreement erroneously
recorded under Other Receivables account
instead of Due from Joint Venture account
14 C5 RTU Unrecorded Credit Memos pertaining to 6.547
January to June 2017
15 DOLE Overstatement of Cash in Bank-Foreign 5.214
Currency, Current Account and Foreign
Currency, Savings Account due to use of
Average Conversion Rates to the dollar
instead of Closing Rates as prescribed
under Section 4, Chapter 16, GAM for
NGAs, Volume I
16 C6 PCIEERD Misstatement of Cash - Treasury/Agency 363.488
Deposit, Trust due to incorrect recording of
deposits of collections of bid documents,
refund of scholarship grant, fund transfer
and adjustments
447
Cluster Amount
/ RO (in M PhP)
17 C6 NNC Inappropriate recording of fund transfers to 436.169
RFOs to CIB-LCCA instead of Advances to
Operating Expenses account
18 C8 DA Erroneous cash transactions 21.662
19 R3 PHIL Petty cash fund was set up instead of 5.794
MECH payroll fund to defray expenses for
Professional, General Services and Labor
and Wages
20 R5 BU Improper charging of disbursements to the 4.330
Cash in Bank ledger accounts
TOTAL 2,285.768
Abnormal/Negative Balances
1 C1 DFA Negative SL balances 310.144
Existence of abnormal and unaccounted 28.249
balances
2 C3 BTr-NG Negative SL balances in six accounts 798.029
3 COMELEC Existence of negative SL balances of 3.999
various COs
4 PET Negative amount under CIB - LCCA and 7.722
CIB - LCSA accounts
5 SCP Negative or abnormal credit balance of the 161.177
JDF Main Savings AccountSCP
6 C4 AFP-GHQ Negative balance in the SL due to 0.010
erroneous entry made in recording the
opening of the account
7 BI Presence of negative and outstanding 7.852
balances of inactive/resigned/retired/
dismissed/deceased former collecting
officers
8 LRA Negative balances of some Collecting 8.063
Officers (COs) as shown in the schedule
9 C8 DA Negative Balances in CIB-LCCA 8.297
10 R2 CSU Negative balance of Cash-Collecting 0.034
Officer account under Fund 05 due to a
defective Student Information Accounting
System (SIAS)
11 R12 USM Book balances include a negative balance 1.332
under the Perf Oil Palm Account
TOTAL 1,334.908
1 C1 DFA Negative balance due to misclassification TL 132
of currencies noted in 31 cases and USD60
reflected in the ORs
7.5.1.6 Other practices of a number of agencies which affected the reliability

of cash balance such as:
No. of Amount
Practice Agencies (in M PhP)
Deficiencies in handling of Petty Cash Fund (PCF) such as grant of 6 2.127
excessive PCF, payments of expenses other than petty operating
expenses or in amounts exceeding PhP15,000, non-preparation of PC 6 Not stated
Vouchers, non-maintenance of appropriate records and registries,
non-replenishment of PCF, as needed or when disbursements
reached 75 percent, among others.
Non-compliance with fidelity bond contrary to Treasury Circular No. 8 44.644
02-2009 and COA Circular No. 97-002, which include among others,
inadequate bond coverage and AOs or other personnel performing 13 Not stated
collection/disbursing functions without approved bonds
Various observations on Official Receipts (ORs) include OR not pre- 9
numbered, discrepancies in information found in ORs as against
448
No. of Amount
Practice Agencies (in M PhP)
RCDs, absence of ORs to support collections, or delayed issuance of
ORs, non-issuance of ORs in numerical order, ORs issued without
dates or signature, etc.
Non-cancellation of stale checks or unreleased checks not restored to 21 88.134
the Cash account
No safety vaults for personnel handling cashiering functions 5 NA
Non-preparation/non-submission of cash reports/records/ 4 75.390
registries/subsidiary ledgers; unupdated cashbook/CDR; non-
compliance with report format, etc. 13 Not stated
Unsupported cash accounts/transactions 6 1,289.289

2 Not stated
No proper turn-over of accountability or transfer of funds between 3
AOs
Delayed submission of bank statements resulting in delayed BRS 1
Cash overage 1 0.650
1 €19.12
1 Not stated
Bank accounts maintained with non-authorized government 1 31.230
depository bank (AGDB)/private bank
Maintenance of one depository account for SUC’s various funds; 2 Not stated
Use of one trust fund for various transfer from NGAs
Non-reconciliation of cashbooks/records and SLs 1
Partial compliance with Expanded Modified Direct Payment Scheme 1 281.248
(ExMDPS)
Collections used for other purposes like check encashment 2 1.148
Absence of strong built-in controls for SUC's Payment Sub- 1 NA
Module/Accounting Module of the Student Information System
Unsecured DO's office/cubicle 1
Non-segregation of collecting and disbursing duties/functions 1 14.022
Non-recognition of Allowance for Impairment for CIB 1 41.309
No prior approval for DFA Post’s credit card transactions 1 CAD$0.163
Maintenance of bank accounts with LBP without authority 1 13.102
Delayed submission of Advice of Income Collections 1 673.776
Non-revaluation of the balances of CIB Foreign Currency 1 98.666
7.5.1.7 The Auditors recommended that concerned Agency officials, among

others:
a) Enforce the restitution/collection of cash shortages discovered during

the conduct of COA’s financial audit on the Agency’s AOs without
prejudice to the filing of appropriate charges against them; adhere to
existing rules and regulations in depositing cash collections under
Section 69 of PD No. 1445, Section 32 of Revised Cash Examination
Manual, and Sections 21 and 22, Manual on the New Government
Accounting System (MNGAS) for National Government Agencies,
Volume I.
b) Require the Cashier and other authorized Collecting Officers to

strictly comply with Section 68 of PD No. 1445 and ensure that all
collections are properly acknowledged through the issuance of ORs
in chronological order or in numerical sequence, in compliance with
Section 4, Chapter 2 of the GAM, Volume I; ensure all collections
are correctly and completely recorded in the cashbook/Report of
Collections and Deposits (RCDs)/cash reports as well as submission
449
of monthly RCDs in accord with Section 89 of PD No. 1445, COA
Circular No. 97-002 dated February 10, 1997 and Section 16 of EO
No. 248; and review the reports of each COs as basis for recording in
the books of accounts.
c) Direct the Accounting Office to prepare the monthly BRSs and

submit the same within the prescribed period pursuant to Sections 5,
6 and 7, GAM, Volume I and Sections 74 and 111, PD No. 1445 to
prove the accuracy of the books and bank balances; prepare the
Journal Entry Voucher (JEV) to recognize the book reconciling items
reported in the BRS at year-end; communicate to the servicing banks
to provide the Accounting Office a timely hardcopy of monthly bank
statements or avail of the I/We-access facility of the LBP wherein
depositors can readily print and monitor account balances online to
ensure timely preparation of BRS.
d) Revert the stale checks back to its proper bank account and record
regularly the cancellation of any stale checks; abide by the provisions
of GAM, particularly Section 56, Chapter 9 - Financial Reporting for
the fair presentation of the Cash – MDS account in the FS; ensure
that internal control measures are in place pursuant to Section 123
and 124, PD No. 1445 and GAM, Volume II.
e) Regularly review the cash accountabilities of all AOs and comply

with the appropriate bonding requirements in accordance with
Treasury Circular No. 02-2009.
f) Comply with the existing rules and regulations on the grant,

utilization and replenishment/liquidation of PCF as prescribed under
Section 35, Chapter 6, Volume I GAM and other pertinent COA
Circulars; ensure that the Petty Cash Fund (PCF) granted is within
the approved monthly requirement of the office to prevent misuse of
government funds; and require the immediate return or refund of
PCF balance which remained idle for a period of two months.
g) For DOLE, use the BSP Closing Rate, instead of the Average Rate,
in translating foreign currencies in accordance with the provisions
stated in Section 4, Chapter 16, GAM for NGAs, Volume I; and
make necessary adjustments for the accounts affected in the
erroneous use of conversion rate, to come up with the correct
information as presented in the FSs.
7.5.2 Receivables
Receivable account balances are unreliable due to significant amounts of

unliquidated cash advances and fund transfers, unsupported/
undocumented dormant accounts and erroneous recording contrary to
existing laws, rules and regulations which may result in substantial losses
to the government.
450
7.5.2.1 Analysis of these receivable accounts disclosed the following conditions, in
material amounts:
No. of Amount
Condition/Reason
Agencies (in M PhP)
a. Unliquidated cash advances (CAs) to Officers and Employees 95 5,187.31
b. Unliquidated fund transfers (FTs) (except PS-DBM/PITC/GA) 59 54,072.99
c. Unsupported/dormant receivables 78 34,392.41
d. Unrecorded/Erroneous recording of CA liquidations/deliveries 29 2,493.13
e. Unrecorded/unbooked receivables 30 7,094.01
1 Not stated
f. Erroneous recording of receivables 29 1,538.27
g. Negative/abnormal balances of receivable accounts 22 573.65
h. Unreconciled General Ledger (GL) and Subsidiary Ledger (SL) 32 5,807.38
balances or amounts per books and confirmation results/other
pertinent records of Implementing Agencies (IAs)/Source
Agencies (SAs)
i. Unreconciled balances with PS-DBM/records disparity 31 1,237.77
j. Unliquidated advances for procurement of commonly-used office
supplies and various equipment aged one month to more than ten
years – Procurement Service-DBM (PS-DBM) 27 12,105.18
Philippine International Trading Corp. (PITC) 10 12,909.04
Government Arsenal (GA) 2 451.52
Agency with unliquidated advance to PS-DBM/PITC/GA-without 1 445.93
breakdown in amount
k. Uncollected/unsettled receivables due to laxity in collection or 39 1,689.50
non-imposition of sanctions
l. Unrecouped Advances to Contractors 9 4,719.12
m. Non-adoption of accrual method of accounting 10 260.17
n. Other deficiencies noted:
1. Non-provision or under-provision of Allowance for Impairment 18 571.00
Loss 4 Not stated
2. Excessive grant of CAs 7 22.09

1 Not stated
3. Grant of additional CAs despite unliquidated previous CAs 10 2,442.65
4. CAs not used for intended purpose 1 3.27
5. Failure to maintain receivables’ SLs 8 3,009.90
6. Inaccurate/improper aging of receivables 2 3.43
7. Absence of reconciliation of reciprocal accounts 1 23.33
8. FTs deposited in SDO’s personal account 1 2.67
9. Control lapses 2 9.71
7.5.2.2 The Auditors recommended that the Accountant/other concerned officials:
a) Adhere strictly to the rules and regulations on the grant, utilization and
liquidation of cash advances and ensure proper monitoring pursuant to
Section 89, PD No. 1445, Section 14, EO No. 298 and COA Circular.
No. 97-002 dated 10 February 1997; require all Accountable Officers
(AOs) to settle/liquidate immediately their cash advances (CAs) within
the prescribed period, once the purpose for said advances were already
served; otherwise, send demand letters to liquidate the same and refund
all remaining unutilized balances, or cause the withholding of salaries of
personnel with outstanding accounts, if warranted; and refrain from
granting new or additional advances to AOs with unliquidated CAs.
b) In the case of unliquidated fund transfers (FTs), monitor regularly/

follow-up on the status of the FTs particularly the long, outstanding FTs,
451
in accordance with COA Circular 2016-005 dated 19 December 2016;
send demand letters to the IAs, NGOs/POs and private companies, for the
immediate liquidation of FTs especially for completed or discontinued
programs/projects through submission of financial/terminal reports
(FRs/TRs) in compliance with COA Circular No. 94-013 dated 13
December 1994; verify claims of Implementing Agencies (IAs) that
liquidations were already submitted and request for copies of the
liquidation documents as basis for adjustment in the Agency books;
henceforth, ensure that liquidations/financial reports are submitted before
making additional FTs to the IAs; and furnish the Audit Team with copies
of demand letters sent to IAs requiring the liquidation of the outstanding
balances of FTs.
In addition, among others, for DICT, to monitor the implementation of

projects and require the IAs to submit updated progress reports on the
status of implementation of all projects necessary in the evaluation of the
program. DPWH, to refrain from entering into contracts/Memorandum of
Agreement (MOA) with the identified delinquent government agencies, in
its future projects, until substantial liquidations have been made on their
unsettled obligations; in the case of DOTr, to avoid the practice of
transferring funds at year-end as this will impact on the effective and
efficient project implementation; and consider including in the MOAs a
provision for the conduct by the DOTr of regular monitoring with specific
timelines of the IA’s utilization of fund transfers and project
implementation. BFAR Legal Officer, to resort to other legal modes of
settlement of accountabilities in case of failure of the IAs to settle the FTs
due for liquidation. DENR FMB Director, to investigate the cause of the
non-receipt of funds by the IAs and file appropriate charges for the
responsible officials/personnel, if warranted. PCAARD, Region IV-A, on
GIA FTs, to increase frequency of field visits; demand submission of
required reports or send demand letters to Project Leaders (PLs) who
failed to submit FRs within the reglementary period; and enforce sanction
against PLs who failed to comply with the submission of FRs within the
deadline.
c) Determine dormant CAs or FTs which can no longer be settled and

analyze if these advances comply with all the conditions and requirements
stated in COA Circular No. 2016-005 dated 18 December 2016, and
accordingly request write-off, following the procedures provided therein.
d) Make the necessary adjusting journal entries to correct the errors,

omissions, and misclassifications noted on the grant or liquidation of
advances/FTs; review the cause of the abnormal balance and make
necessary, appropriate, and duly supported adjustments in the books; and
henceforth, observe the proper recording of accounts and transactions in
accordance with Section 111, PD No. 1445, other existing accounting
rules and regulations, and PPSAS I.
e) Verify the noted discrepancies between the GL and SLs or amounts per
books and confirmation results/other records, and make appropriate
452
adjusting entries as warranted. Conduct periodic reconciliation of the
accounts with the IAs/recipients for early detection of discrepancy.
For CDA, to issue guidelines to LBP on the retirement of the investments
particularly with the closed Cooperative Rural Banks (CRBs), and
reconcile the balance per books of Due from GOCCs-QUEDANCOR
with the QUEDANCOR books in order to establish its correct balance.
While AFP-GHQ, to exert all efforts to analyze, verify, confirm and
identify the causes of unreconciled, long-outstanding and negative SL
balances of its receivable accounts, particularly PS-DBM and PITC.
f) Coordinate with PS-DBM and reconcile periodically Agency records with

the PS-DBM records to promptly thresh out any discrepancies; take-up
immediately the necessary adjustments in either records, as necessary;
exhaust all possible means of reconciling records with the PS-DBM.
The following options, as recommended by STII auditors, may be
adopted: (i) Confirmation of Fund Balances and Issuance of Certificate of
Cash Availability based on the balance of Unutilized Deposits, (ii)
Refund of Unutilized Deposits, and (iii) Reconciliation of Accounts; and
unutilized balance of advances may also be applied to succeeding
procurements to avoid accumulation of funds with the PS-DBM.
g) Demand for the immediate delivery by PS-DBM/PITC/GA of all items

procured; otherwise, request these to refund the total unused advances for
deposit to the National Treasury; stop transferring funds to
aforementioned agencies unless there is an assurance that requisitioned
items will be delivered promptly; and make constant follow-up/demand
with the concerned agency on the immediate delivery of the supplies and
equipment requested.
h) Intensify the collection of unsettled receivables, by coordinating with the

individual debtors or authorized officials of the concerned company, or
sending demand letters, as needed, to expedite collection of said
receivables; conduct periodic verification, analysis and validation to
prove the existence of these receivables; and in the case of settlement of
disallowances, comply with the provisions of COA Circular No. 2009-
006.
Moreover, among others, for CDA, to immediately demand the full

settlement of long outstanding loan balances and intensify legal remedies
against the delinquent cooperatives, which includes among others, the
foreclosure of collateral, as provided for in the CDA Policies and
Procedures on Lending and the Loan agreement signed by both parties.
On the other hand, for FDCP, exert utmost efforts to locate the
whereabouts of the operators/proprietors of the closed cinemas and
compel them to settle their accounts.
i) Demand for the immediate refund of the unrecouped advances. Remedial

actions/measures may include: (i) forfeiture of the corresponding
irrevocable standby letters of credit or guarantee payments/bonds posted
by the concerned contractors; and/or (ii) initiate appropriate legal or
453
administrative sanctions, if warranted, against the contractors and/or
agency personnel who are found negligent in their obligations/
responsibilities.
j) Record the accrual of Accounts Receivable and recognize the related

income and expenses in the appropriate account in accordance with
Section 2, COA Circular. Letter No. 2004-002, Chapter 2, GAM for
NGAs, Volume I, Appendix 6, GAM for NGAs, Volume II, Section 112,
PD No. 1445.
k) Maintain adequate schedules and subsidiary records, to support the GL

controlling accounts, in compliance with the provisions of PD No. 1445,
and Appendix 6 of GAM for NGAs Volume II.
l) Formulate/establish an Agency guideline or revisit existing policy on the

provision of Allowance for Doubtful Accounts/Allowance for Impairment
Losses, based on factors such as aging of accounts, collection
experiences, expected loss experiences and identified doubtful accounts,
pursuant to Section 10, Chapter 7, GAM, Volume I.
m) Avoid granting excessive CAs/FTs by establishing certainty of program/

project implementation before the release of said CAs/FTs; limit the CA
for its specific purpose, the amount of which will be based on its
approved activity budget to ensure the full implementation of the
program/project/activity to further avoid underutilized cash subject for
refund; and require AOs to refund immediately cash advances that has
not been used for a period of two months in accordance with COA
Circular No. 97-002.
7.5.3 Inventories
Doubtful year-end Inventory account balances were noted in a number

of agencies due to variances in Accounting and Property records, failure
to conduct a complete physical count, unsupported transactions, non-
recording of issuances of supplies and materials, and erroneous recording,
among others. Moreover, the existence of dormant or non-moving
inventories may lead to wastage of government funds.
7.5.3.1 Audit of the Inventory account of NGAs for CY 2017 disclosed the following
conditions affecting the accuracy of the year-end balances, in substantive amounts:
No. of Amount
Condition
Agencies (in M PhP)
a. Variance between Accounting and Property records due to non- 48 5,416.12
submission of Report of Supplies and Materials Issued (RSMI), 7 Not stated
discrepancies between the book balance and Report of Physical Count
of Inventory or between Stock Cards (SCs) and Supplies Ledger Cards
(SLCs), among others
b. Non-conduct of regular physical count of inventories or non- 31 1,266.29
preparation/ submission of the 5 Not stated
c. Unsupported/undocumented inventories 12 1,339.28
3 Not stated
454
No. of Amount
Condition
Agencies (in M PhP)
d. Dormant, non-moving, idle or obsolete inventories for a no. of years, 18 306.86
still undistributed or undisposed 2 Not stated
e. Erroneous recording of inventory transactions 36 895.34
2 Not stated
f. Non-recording of inventories issued/non-submission of RSMI 30 25,280.21
9 Not stated
g. Non-observance of Perpetual Inventory method of recording delivered/ 32 349.22
procured supplies; treated as outright expense 4 Not stated
h. Unrecorded supplies 14 223.90
i. Unreconciled GL and SL balances 1 5.88
j. Negative unreconciled SL balance 1 0.24
k. Non-maintenance/non-update of subsidiary ledger cards/stock cards 18 1,611.32
8 Not stated
l. Other practices affecting the reliability of the Inventory accounts:
1. Overstocking of Inventories which may result to wastage of 2 13.21
government resources
2. Non-adoption of information system on asset tracking and 1 Not stated
inventory management resulting in inaccurate inventory reports
7.5.3.2 The Auditors recommended that the Accountant and Property/Supply

officer:
a) Conduct regular reconciliation of accounting and property records

particularly the inventory records; maintain/update the recording and
posting of materials received and issued in the Subsidiary Ledger Cards
(SLCs) and regularly reconcile with the Stock Cards (SCs); and instruct
responsible officers to continuously supervise subordinates by reviewing
their work systematically; thus, minimizing errors.
b) Adhere to the Perpetual Method of recording inventories under Sections 9

and 14, Chapter 8 of the GAM for NGAs, Volume I, recognizing inventory
account upon receipt of deliveries and expense upon issuance or
distribution of the inventories; and Property and Supply Office to regularly
submit on time to Accounting Office all Report of Supplies and Materials
Issued (RSMI) to enable the latter to accurately record the supplies
issuances.
c) Thoroughly analyze, verify, confirm, reconcile, identify, and account the

discrepancies using available records, and prepare the necessary
adjustments in the books of accounts; and exert extra effort to determine
the details and/or locate the supporting documents of the inventories
recorded under “For Reconciliation” in the SLs.
d) Require the conduct of physical count of inventories semi-annually to

check the integrity of property custodianship and prepare the Report on
Physical Count of Inventories (RPCI) in accordance with Appendix 66 of
the GAM, Volume II Moreover, complete the issuance of the Inventory
Custodian Slips (ICS) for tangible items classified as semi-expendable
property in compliance with the provisions of Chapter 8, GAM for NGAs.
e) In the case of Petron Corporation, strictly comply with the Special

Conditions of Contract (SCC) on the submission of Invoice Receipts (IRs)
to support the delivery of FOL inventories; direct the PNP National
455
Headquarters, Person deprived of Liberty (POL) Section to closely
monitor the submission of delivery documents and enforce the prompt
submission thereof by the Petron Corporation in case of delay; and ensure
that recorded fuel issuances/consumption are supported by proper and
complete documents.
f) Check whether the non-moving supplies and materials can still be utilized,
and prioritize their issuance before making any additional purchases;
require the Disposal Committee to determine the appropriate method of
disposal of dormant, idle, and obsolete items and immediately dispose the
same as provided under Section 79 of PD No. 1445 to avoid its
deterioration resulting in wastage of government funds; and in the
meantime, assess and recognize an allowance for impairment losses for the
damaged/unusable inventories in the books of the Agency to write-down
the same to the net realizable value.
g) Observe strictly the provision of EO No. 292 on the stock requirements;

ensure that the procurement of supplies and materials shall not exceed the
three-month requirement of the office through proper planning to avoid
obsolescence or damage to inventory items; and prepare the Report of
Accountability for Accountable Forms (RAAF) accurately and observe
strong controls and monitoring in procurement and issuance of the
inventories.
7.5.4 Property, Plant and Equipment (PPE)
The balances of PPE accounts of a number of agencies are unreliable due

to unrecorded or erroneously recorded transactions, failure to conduct a
complete physical inventory and prepare/submit the required reports, or
recognize depreciation, unreconciled Accounting and Property records or
unaccounted variances, among others.
7.5.4.1 Verification of PPE accounts showed the following conditions:

No. of Amount
Condition
Agencies (in M PhP)
a. Unrecorded PPEs/donated properties 73 27,076.11
8 Not stated
b. Failure to capitalize major repairs 5 50.36
c. Failure to recognize depreciation 26 1,611.03
6 Not stated
d. Unrecorded disposal/destroyed/lost PPE or properties donated to 42 20,114.40
other agencies/offices 1 Not stated
e. Erroneous recording of PPE transactions 120 5,769.90
3 Not stated
f. PPE accounts with abnormal/negative balances 3 7.23
1 Not stated
g. Undocumented/unsupported transactions 41 78,889.50
10 Not stated
h. Variance between Accounting and Property records 98 121,657.20
6 Not stated
i. Failure to conduct physical count of PPE 38 88,805.89
456
No. of Amount
Condition
Agencies (in M PhP)
7 Not stated
j. Unreconciled GL and SL balances 3 1,236.14
k. Dormant accounts 7 2,673.07
2 Not stated
l. Undisposed unserviceable properties 58 1,104.83
5 Not stated
m. Unutilized/idle properties for a number of years 14 298.79
2 Not stated
n. Failure to insure PPEs/Vehicles with GSIS GIF 53 33,606.36
12 Not stated
o. Non-existing/disposed assets still recorded in the books 4 67.30
p. Purchased/donated land with ownership issues/title not yet 15 2,035.38
transferred 3 Not stated
q. Non-preparation/non-submission of RPCPPE; non- 52 91,499.55
maintenance/non-issuance of PPELC/ARE/Other required 10 Not stated
reports/schedules
r. Non-provision of allowance for impairment losses 14 865.25
1 Not stated
s. Other deficiencies noted affecting the reliability of the PPE accounts:
1. Incomplete or absence of documentation 2 Not stated
2. Proper care and maintenance of vehicles/properties 2 12.96

3. Vehicles issued to unauthorized personnel 4 17.24
4. Lack of specific policies/guidelines on disposal of vehicles 1 0.69
7.5.4.2 The Auditors recommended that the Accountant and Property/Supply

Officer:
a) Observe the proper recording of accounts and transactions pertaining to

Agency properties acquired or donated in accordance with the Government
Accounting Manual (GAM) and other existing accounting rules and
regulations in order to fairly present the financial statements; prepare the
necessary journal entries to recognize the unrecorded assets, reclassify
those that were erroneously classified, and correct other errors/
discrepancies noted; and capitalize all major repairs/construction of
structures.
b) Comply with the provisions of Chapter 10, GAM, Volume I such as

maintenance of Property, Plant and Equipment Ledger Cards (PPELCs) by
Accounting Office and Property Cards (PCs) by Property/Supply Office,
reconciliation of the difference between the RPCPPE and GL balances and
preparation of the necessary adjustment, if warranted, reclassification of
PPEs costing below PhP15,000.00 threshold as expenses, preparation of
Construction-in-Progress Ledger Cards (CIPLCs) to support the balances
presented under the CIP account, and recognition/computation of
depreciation for PPEs, among others. Observe strictly the issuance of
Property Acknowledgement Receipt (PAR) for all PPE upon transfer of
assets to Accountable Officers (AOs), and accomplish each PAR properly;
and exert effort to verify the “For Reconciliation” accounts, if any; identify
the items in each PPE accounts by taking into consideration the details of
SLs/PPELCs manually prepared prior to the adoption of the e-NGAS,
457
c) Ensure that all donated/disposed PPEs are recorded or dropped from the
books of the Agencies for accurate presentation of the PPE accounts in the
FSs. On the other hand, prepare IIRUP for the unserviceable vehicles that
are beyond economic repair and report any disposal of the unserviceable
PPE in the same accomplished report pursuant to Sections 40 and 42,
Chapter 10, GAM, Volume I; and request from the Administrative Division
for the disposal all unserviceable PPEs.
d) Enforce strict adherence to GAM and pertinent COA Circulars/issuances

covering the submission of all required supporting documents to
substantiate validity of the PPEs as well as hasten the titling of land or
transfer of ownership of other properties. Lost/missing PPEs derecognized
in the books should be supported with a Report of Lost, Stolen, Damaged,
Destroyed Property (RLSDDP) and a Notice of Loss. For DPWH, to cause
the immediate verification of the nature of the undocumented balances and
provide details that would lead to its proper disposition.
e) For PCGG, to institute a policy and guidelines on the recording and

disposal of Abandoned/Surrendered Property/Assets, and coordinate with
the management of surrendered corporations/agencies to determine which
appropriate entity that will record the assets. Moreover, provide an updated
list of inventory of Transfer Certificate of Titles (TCTs) based on the
conducted inventory count as well as explanation as to the whereabouts of
the two TCTs which were not presented.
f) Provide corresponding depreciation for the all PPEs to conform with the
prescribed accounting standards and in consonance with Chapter 10,
GAM, Volume I to ensure the fair presentation of the related accounts in
the financial statements.
g) Insure all insurable properties with the Government Insurance Fund (GIF)
of the GSIS pursuant to the Property Insurance Law or RA No. 656, as
amended by PD No. 245 and COA Circular No. 92-390, to ensure that the
government be indemnified for any possible losses in case of fire, theft,
earthquake and other fortuitous events.
h) Undertake a test of impairment of all PPEs, including assessment of

impairment loss on PPEs reported as lost/condemned/destroyed,
in accordance with Section 28, Chapter 10, GAM, Volume I.
7.5.5 Investments
Reported practices in some agencies led to doubtful validity and

correctness of the Investment account balances as of 31 December 2017:
No. of Amount
Condition
Agencies (in M PhP)
Unreconciled balances between books and confirmation results or actual 3 243.09
stock certificates(CDA, PCGG and BWSC)
Undocumented/unsupported investments (CDA, Batangas SU) 2 29.08
458
No. of Amount
Condition
Agencies (in M PhP)
Erroneous recording/misclassification of Investment accounts (MDFO, 7 21,375.99
CESB, PPA, UPS, BWSC, Batangas SU)
Other practices affecting reliability of Investment accounts:
1. Non-provision of Allowance for Impairment (DA) 1 123.21
2. Non-amortization of Investments (MDFO) 1 422.82
a) Analyze the Investment accounts and make necessary adjustments/

reclassifications to the appropriate accounts of erroneously
recorded/misclassified transactions.
b) Reconcile the number of shares recorded in the agency’s books with the
amount of shares and stock certificates on hand and as confirmed by the
corporations; formulate guidelines/policies in recording the shares of
stocks and other surrendered assets; and maintain SL per investment and
reconcile it with the controlling account in the GL.
c) Require CDA to present the Certificate of Stocks for investments placed

in 21 cooperatives to support the recorded transactions in the books.
Moreover, the Agency should provide Allowance for Impairment on
investments placed in investee-cooperative banks which under liquidation
process, already terminated or undergoing liquidation of assets and file
claims against these banks with the PDIC for its recovery.
d) Batangas State University to make representation with Sorosoro Ibaba

Development Cooperative (SIDC) that the stock certificate representing
the financial interest of the University in SIDC be named after the
University to ensure ownership of 1,865 shares of stocks as associate
member of SIDC.
e) Municipal Development Fund Office (MDFO) to adjust and/or revalue

the 24 Held-to-Maturity Investments using the effective interest method,
and ensure regular amortization of the investments with records kept in
separate subsidiary ledgers.
7.5.7 Intangible Assets/Other Assets
Deficiencies were noted in the transactions of some agencies pertaining to

Intangible Assets or Other Assets accounts affecting the reliability and
accuracy of the balances at year-end:
No. of Amount
Condition
Agencies (in M PhP)
a. Failure to amortize the intangible assets 2 421.68
b. Unreconciled GL and SLs/other records 2 368.70
c. Abnormal/negative accounts balances 3 5.14
d. Non-maintenance of SLs 4 5,009.33
e. Unaccounted/doubtful existence of Computer Software/other assets 1 10,777.24
459
No. of Amount
Condition
Agencies (in M PhP)
f. Erroneous recording/misclassification of transactions 16 6,905.29
g. Dormant assets such as Guaranty Deposits 4 491.09
h. Unadjusted Deposit Letters of Credit (DLCs) 6 26,944.79
i. Unrecorded intangible/other assets 10 322.42
j. Other practices affecting the reliability of Intangible/Other Assets
accounts:
1. Unserviceable properties classified under Other Assets still 3 14.61
undisposed
2. Prepayment for one month advance rental unrefunded due to 1 0.12
change in contract provision from 3 months to 2 months
3. Overlapping of FOL Prepayments 1 205.06
4. Other Prepaid Expenses not fully disclosed in the Notes to FSs 1 0.22
7.5.8 The Auditors recommended that concerned officials, among others:
a) Verify and analyse discrepancies or dormant/unsupported/unadjusted/

unrecorded accounts and prepare the necessary adjustments/
reclassification; maintain objectivity and consistency in keeping of
accounts to safeguard against inaccurate or misleading information; and
comply with the Accounting policy for intangible assets set forth in
PPSAS No. 31.
b) BIR, to reclassify the Computer Software as with definite useful life,

determine the useful life, and provide the required amortization.
Chiefs of Accounting Division, NO and the Chiefs of Regional Finance
Divisions (RFDs), to prepare the necessary adjusting journal entries to
correct the errors; and henceforth, observe the proper recording of
accounts and transactions in accordance with the GAM and other existing
accounting rules and regulation.
c) PAF, to regularly record the reconciling items and monitor the charges to
the DLCs; and agencies should reclassify the assets recorded under Other
Assets account to the appropriate PPE accounts.
d) COMELEC, to extensively review, analyze and reconcile the Prepayment

accounts, and if warranted, effect proper adjustments in order to present
the reliable balances of the accounts.
e) BOC, make the necessary adjusting journal entries to correct the errors
and omissions noted; and henceforth, observe the proper recording of
accounts and transactions in accordance with Section 111 of PD No.
1445, other existing accounting rules and regulations, and PPSAS I.
7.5.9 Liabilities
Liability account balances for CY 2017 of a number of agencies were

unreliable as these payables included long outstanding payables with no
valid claims, or unsubstantiated payables, or with unreconciled GL and
SL balances, or agency books and results of confirmations with the third
460
parties, or non-maintenance of supporting SLs, or unrecorded or
erroneously recorded transactions.
No. of Amount
Condition
Agencies (in M PhP)
Dormant/long outstanding unsupported payables; unidentified 61 24,193.20
liabilities 1 Not stated
Unrecorded/erroneously recorded payables 63 3,512.35
1 Not stated
Unreconciled between GL and SLs/other reports 11 3,122.23
1 Not stated
SLs/other accounting records not maintained 12 1,104.49
1 Not stated
Discrepancies between amounts per books and confirmation 16 903.04
results/schedules/other reports
Negative/abnormal payable balances 25 536.11
Other practices affecting the reliability of the Payable accounts:
1. Utilization of Special Trust Fund (STF) not maximized 1 118.00
2. Erroneous presentation of account 1 238.37
a) Instruct the Accountant to review and analyze all recorded payables that
remained outstanding for two or more years; comply with the guidelines
in COA Circular No. 2016-005 dated 19 December 2016 on the proper
disposition/closure of dormant account, which include the filing of a
request for write-off; and revert long outstanding payables, particularly
those without valid claims or undocumented for over two years, to
Accumulated Surplus/(Deficit) account, pursuant to Section 98, PD No.
1445 and DBM-COA Joint Circular No. 99-6.
In the case of dormant fund transfers (FTs) from other agencies, exert
more effort to identify the concerned Source Agencies (SAs), if
practicable by tracing and using the work back method, and return to the
SA any unused/unexpended balance of fund transfers upon completion
of the project; and strictly abide by COA Circular No. 94-013, which
prescribes the rules and regulations in the grant, utilizations of funds
transferred to Implementing Agencies (IAs).
b) Identify/trace the causes of errors/misposting/misclassifications in the

books of accounts and prepare the necessary adjusting entries to correct
the balances of the affected Liabilities or other accounts; and expedite
the analysis and reconciliation of accounts with the view of eliminating
the negative/abnormal balances.
c) Exert efforts to analyze the unreconciled General Ledger (GL) and

Subsidiary Ledger (SL) balances, including those with negative,
abnormal balances, and effect proper adjustments, if warranted; and
henceforth, reconcile the SL balances with the GL balance regularly or at
the end of each month and prepare or maintain supporting schedules
regularly to prove the accuracy of the account balances.
461
d) For DILG, to coordinate with the SAs to establish the correct balance of
the unliquidated FTs and make the necessary adjustments in the books of
accounts; and in the case of PA, reconcile records with concerned
NGAs/ other Field Accounting Units (FAU) to determine the details of
the unaccounted discrepancy, ensure that liquidations submitted by the
different FAUs are duly supported by pertinent documents, and take-up
adjustments for valid reconciling items in the books to bring the records
into agreement.
e) MIRDC, to request from the SA Accountant copy of the JEV for

recording the submitted liquidation reports; revert to the SA the
remaining fund balances, if any, including the amount of PhP1.676
million pursuant to Section 4, COA Circular 94-013 dated 14 December
1994 and Section 63, Chapter 6, GAM Volume I. Otherwise, the Agency
should draw a JEV for the closing of the remaining balances and furnish
the SA.
f) CNU, to reconcile the balances with the amount reported/confirmed by

the creditors for the unpaid accounts of the University and immediately
prepare adjusting journal entries to correct the account; ensure that all
awarded projects are duly funded, with proper authority of its incurrence;
and refrain from recording payable accounts without valid creditors’
claims and obligations.
7.5.11 Revenues
CY 2017 Revenue account balances of a number of agencies are of

doubtful accuracy due to erroneous recording, use of cash basis instead
of accrual method of accounting, absence of authority or supporting
documents on collection of income, and internal control weaknesses,
among others.
No. of Amount
Condition
Agencies (in M PhP)
Unreceipted/unsupported revenues/income; collections without 14 472.42
authority; non-maintenance/preparation of SLs, income reports and other 5 Not stated
records
Erroneous recording of revenues 19 8,861.35
Non-conduct of regular verification/validation of sales/cargo production 3 201.35
reports 2 Not stated
a) Classify the revenue/income accounts properly in the books in accordance

provisions of Chapter 3 of GAM, Volume III; ensure completeness of
required supporting documents to avoid audit suspensions and charges;
observe strictly the issuance of Official receipt (OR) as proof of payment
received or collection; and submit the required Report of Collection and
462
Deposit (RCD) within the reglementary period for proper and timely
recording of transactions.
b) Comply with the provisions of Section 4, General Appropriations Act

(GAA) for CY 2017 pursuant to Section 44, Chapter 5, Book VI of E.O.
No. 292, s. 1987 and Section 65 of P.D. No. 1445 and deposit revenues
collected to the Bureau of the Treasury (BTr). For PRC, to reconcile the
discrepancy found on the unremitted collections of PhP12.115 million and
PhP100.70 million by the DBP-DCI and Dragonpay Corporation,
respectively, and demand immediate remittance to the BTr of the
undeposited collections.
c) For PMO, to stop the practice of automatically deducting the retention fee
from the proceeds of the disposition efforts, sale, leases, and other income
without prior approval from the PrC.
d) PSU (SUC), to maintain the correct form of SLs, as presented in GAM

Volume II, for all Fiduciary and Non Fiduciary Fees collected from main
and external campuses amounting to PhP319.61 million in CY 2017; and
reconstruct the SLs to arrive at the correct balances of each fees collected
from previous and current years. On the other hand, the Budget Officer
should complete the registries for all types of collections in order to be
updated of the monthly and year-end balances of all fees, and present a
detailed PRE by including the balances of all fees collected as one of the
sources of revenues.
e) SUCs, to prepare and submit the financial statements and separate

journals and ledgers for each IGP and maintain a separate subsidiary
records to identify sustainable projects; and regularly update and submit
the required financial reports as prescribed by Chapter VII, Manual of
Operations for Income Generating Projects of State Universities and
Colleges, and the pertinent provisions of PD No. 1445.
7.5.13 Procurement/Expenses
7.5.13.1 Procurements not in accordance with RA No. 9184 and its Revised
Implementing Rules and Regulations (RIRR)
No. of Amount
Condition/Reason
Agencies (in M PhP)
1. Observations related to RA No. 9184/RIRR:
1.1 Procurement of goods, services and equipment without public 8 101.43
bidding
1.2 Procurement thru alternative mode of procurement like 13 218.17
negotiation/direct contracting, shopping, or exclusive
distributorship without complying with the conditions stated under
RA No. 9184
1.3 Procurement of goods, services and infrastructure projects not 21 421.67
included in the Annual Procurement Plan (APP)
1.4 Procurement of common-use supplies not made with PS-DBM 11 53.36
1.5 Non-posting/delayed of requirements for procurement like 12 135.68
quotations, etc. in PhilGEPs website and other site provided under
RA No. 9184 or non- compliance with COA issuance/s
1.6 Advance payments made to suppliers 9 53.23
463
No. of Amount
Condition/Reason
Agencies (in M PhP)
1.7 Non-imposition of liquidated damages for delayed deliveries of 17 490.71
procured goods and services
1.8 Bidders did not meet eligibility requirements or inadequate post- 7 29.81
qualification of contractors
1.9 Contract awarded despite incomplete supporting documents 15 3,045.32
1.10 Delayed procurements/long procurement timeline inconsistent with 9 10,407.48
GPPB Manual of Procedures in Procurement of Goods/Services
1.11 Various BAC deficiencies as follows:
a) Non-preparation of Procurement Monitoring Report 4
b) Non-compliance with procedures in the termination of 1 0.01
contracts 1 5.11
c) Non-conformity with Technical Specifications provision
(Section VII, RA No. 9184) 3 3.90
d) No PPMP supporting document 1 707.93
e) Approved Budget Cost (ABC) awarded beyond the 90 days 4 436.03
f) No BAC resolution for negotiated contract or failure of 1
bidding
g) BAC and Technical Working Group (TWG) have not
1 355.63
undergone procurement training or capacity development
h) BAC passed a Net Financial Contracting Capacity (NFCC) 1
lower than the approved budget for the contract
i) BAC did not conform with the schedule of procurement
activities
j) Difference between the ABC in PHILGEPS website and 1 0.02
abstract of bids
k) Non-thorough evaluation of documents cited in the Notice of
Award (NoA)
l) Alterations in financial bid form/unreconciled bid offer 1
m) Allowing non-member to attend/participate in the procurement 1
process
n) Brand names included in the description of each item of goods
1 2.14
listed in the Schedule of Requirement and Technical
Specifications of the Philippine Bidding Documents
1
o) Non-imposition of administrative penalty of suspension and
blacklisting to every contractors
p) Non-conformity with requirements for BAC composition 1
q) Conduct of pre-bid without quorum and signed Abstract of 1 249.20
Bids 1 4.97
r) Supplies and materials awarded based on the lump-sum
supplier’s quotations and not on the cost of each item 1 565.27
s) Notice not given to bidders
1.12 Procurements made thru cash advance or reimbursement basis 16 17.21
1.13 Incomplete/insufficient data/information on contracts/Purchase 5 956.06
Orders and non-submission of contracts to COA
1.14 Non-compliance with warranty security requirement 5 1,235.48
1.15 Splitting of transactions/non-consolidation of requisitions 5 10.20
1.16 Failure to withhold retention money on payments of infrastructure 5 41.17
projects/erroneous deduction
1.17 Unsupported Variation Orders 4 31.95
1.18 Advance payments (mobilization fee) without bank guarantees/ 2 9.29
bonds
1.19 Other practices not in accordance with RA No. 9184/RIRR:
1.19.1 APP-related findings 7 650.63
1.19.2 Violations or lapses in procurement 9 247.66
1.19.3 Timing in procurement of goods and services 1
1.19.4 Implementation of policies, rules and regulation without 1
deliberation and approval of GPPB
1.19.5 Non-compliance with prescribed period of effectivity of 1
Performance Security
1.19.6 Failure to assert rights to claim the Performance Bond/Security 1 474.11
Deposit for terminated contracts
1.19.7 Contracts awarded despite not being the lowest bidder, without 2 3.35
approved budget or before the approval of the GAA for FY
2017
464
No. of Amount
Condition/Reason
Agencies (in M PhP)
1.19.8 Failure to conduct the Contractors’ Performance Evaluation 1
System (CPES guidelines, Annex E of the RIRR of RA No.
9184 and Administrative Order No. PDLC 17-19)
1.19.9 Absence of binding contract for lease, extension of janitorial 2 82.19
and security services contracts without prior substantial
activity, failure to prepare and post NOA and NTP, and
failure to require the submission of mayor/business permits
by the winning suppliers, etc.)
1.19.10 Non-issuance of the Certificate of Acceptance within the one 1 3,210.54
year
1.19.11 Inconsistent cost of bidding documents 1 6.63
1.19.12 Non-conformity with the requirements in setting of ABC 4 8.03
1.19.13 Delayed inspection of projects 1 244.32
1.19.14 Deliver and acceptance of procured goods before documents 1 1.29
pertinent to contract were approved
1.19.15 Failure to conduct pre-procurement conference for contracts 1 370.43
1.19.16 Pakyaw contracts awarded despite non-compliance with its 2 2.67
requirements
1.19.17 Procurement of goods without an approved Information 1 5.00
Systems Strategic Plan (ISSP)
1.19.18 Contracts entered were not rescinded despite exceeding 1 53.36
specific time durations equivalent to 10 percent of the contract
time plus time extensions
1.19.19 Non-justification of change in mode of procuring projects 1 5.52
1.19.20 Projects not completed within contract time 1 14.70
1.19.21 Variances between the ABC and the contract amount 1 10.08
1.19.22 Deficiencies in the issuance of warranties for projects 1 21.43
1.19.23 Issuance of Certificate of Completion for projects which were 1 4.84
not yet completed
1.19.24 Estimated Bill of Quantities (EBQ) does not tally with the Bill 1
of Quantities offered by the winning bidder
1.19.25 Timely revision/adjustment of ABC 1 0.69
1.19.26 Received performance security without certification from 1 22.22
Insurance Commission
1.19.27 Particular activities not adequately undertaken 2 3,102.86
1.19.28 Deficiencies and inconsistencies on work specifications 2 1.53
1.19.29 Failure to strictly monitor the construction project 2 29.12
1.19.30 Approval of indefinite suspension of work 1
1.19.31 Non-compliance with the requirements on making and sending 1
Letter on Invitation
1.19.32 Non-compliance with the requirement on posting and the 1 1.33
preparation if the cost-benefit analysis, and detailed
descriptions/specifications
1.19.33 Contract cost not stated in Philippine Peso 1 224.75
2. Non-compliance with transparency seal/non-posting of Programs, 11 237.11
Projects and Activities PPAs (COA Circular No. 2013-004 dated
30 January 2013)
7.5.13.2 Practices affecting reliability of expense accounts, some even contrary

to existing laws, rules and regulations.
No. of Amount
Condition
Agencies (in M PhP)
Errors in recording/Misclassification of accounts 31 485.44
Prior-year’s expenses charged to current year budget 7 5.58
Expenses paid out of Special Trust Funds instead of regular 4 5.46
appropriations
Unrecorded Expenses 4 95.47
Other practices affecting the reliability of the Expense accounts:
1. Lack of coordination with accountable officer 1 0.02
2. Practice in accomplishing DVs and checks 2
465
No. of Amount
Condition
Agencies (in M PhP)
3. Non-compliance with the allocations as provided in Allotment 1
Orders issued
4. Appropriate economy measures were not observed in the 1 0.35
disbursements for Representation Expenses
5. Expenses not included in the Program of Expenditures (POE) (if 1 0.03
included, expenses incurred were more than the allocated amount
for the specific expense)
6. Documents were not processed and completed within reasonable 1
time
7. Non-maintenance of SLs 1 96.10
8. Erroneous computation of depreciation 1 10.37
9. Expense charged to savings without authority 1 0.50
10. Failure to register motor vehicles within the required period of
registration 1 0.01
11. Deduction of 12 percent storage fee from all the Fuel, Oil, 1 0.14
Lubricants (FOL) products delivered
1. Strictly comply with procurement procedures prescribed in the 2016

Revised IRR of RA No. 9184 particularly on the following, among
others:
(a) Conduct of public bidding on procurement of goods and services in

accordance with Section 10, Rule V, RIRR and avoid splitting of
procurements. Supplies for the two-month period may be a basis in
determining the mode of procurement to be adopted. Bidding of
procurements/projects shall be done on a quarterly basis in
accordance with the approved Physical and Financial Plan, as
provided under the RIRR. Piece-meal procurements, unless duly
justified, shall be avoided. Moreover, discontinue the practice of
making advance payments to comply with Section 88 of PD No.
1445.
(b) When transactions necessitate the application of alternative

methods of procurement, the requirement/conditions stated in
Annex H - Consolidated Guidelines for the Alternative Methods of
Procurement of RIRR shall be complied.
(c) Preparation and submission of APP and PPMP in the prescribed

format, including all the necessary/required data like indicate one
mode of procurement for each item to be purchased. In case of
change in the mode of procurment, secure the approval of the Head
of the Procuring Entity (HOPE) in accordance with Appendix 2,
GPPB Circular No. 08-2015 and Section IV.A, Annex H, IRR.
All procurement should be within the approved budget in
compliance with Section 7.2, RIRR.
(d) Procurement of common use supplies from the Procurement

Service (PS)-DBM in compliance with Administrative Order No.
17 and Letter of Instruction No. 755, as provided in RA No. 9184,
unless there is a certificate of non-availability of stocks on grounds
other than physical unavailability issued by PS-DBM.
466
(e) Posting of all procurements above PhP50,000.00 including the
notices of award in the PhilGEPs website, website of the Procuring
Entity, and any conspicuous place in the premises of the Procuring
Entity as required under Sections 54.2 and 54.3 of the RIRR.
Require bidders to provide their PhilGEPS Registration Number
prior to the award of the contract; and Refrain from indicating
brand names in the request for quotation. Product specifications
should be detailed in the Purchase Requests.
(f) Imposition of liquidated damages by the Agencies on erring

contractors for late deliveries of procured supplies/services or
completion of projects. Liquidated damages shall be deducted from
the claim of the Contractor for payment of retention fee that is, 10
percent on project costs, as a safety net in case of completion of
projects beyond the contract duration.
(g) Thorough examination of bidding documents of the bidders by the

Bids and Awards Committee (BAC) as required under Section
8.5.2 and 23.1, 2016 RIRR to determine whether the bidders are
eligible to bid for the projects.
(h) Completion of procurement activities within the maximum period

in the RIRR.
(i) Posting of performance bond is made within 10 days from receipt

of Notice of Award.
(j) Mobilization fee of 15 percent, as advance payment to contractors,

must not be paid unless they have submitted the irrevocable
standby letter of credit, a bank guarantee or a surety bond callable
upon demand pursuant to Section 4, Annex A, RA No. 9184 and
Section 9.1.1.1, COA Circular 2012-001.
(k) Corrections and/or remedial actions on defective works must be

undertaken at no additional cost to the government, otherwise,
withhold the equivalent amount of money due the contractors
should they fail to take action within a reasonable period of time.
(l) Issuance of the certificates of final acceptance for fully completed

infrastructure projects. Moreover, require the contractors to post a
warranty security for such completed and accepted projects in
compliance with the provisions of the RIRR.
2. Prepare the Purchase Orders (POs) completely containing the necessary

information prescribed under COA Circular No. 96-010 to clearly present
the terms and conditions of a contract.
467
3. Comply with the requirements of COA Circular No. 2013-004 relative to
the posting of relevant and detailed information of all on-going
government PPAs in signboards following the prescribed forms/design.
4. Take up necessary adjustments/correcting entries in the books for

erroneous recordings or misclassifications to ensure accuracy of year-end
balances of the Expenses accounts.
5. Stop the practice of utilizing the current year’s appropriations to pay prior
year’s obligation; and recognize the assets/expenses in the year for which
these were incurred following the accrual basis of accounting/reporting
prescribed in Chapter 2, GAM for NGAs, Volume I. Likewise, ensure
that all obligations are duly allotted with available appropriations in
compliance with Sections 11 and 34, GAM, Volume I, Sec. 29(1), Section
4(1), PD No. 1445, and Article VI, 1987 Constitution.
6. Refrain from charging expenses like RATA, Honoraria, etc. against the
SUC’s Special Trust Fund (STF)/Other Funds in accordance with the
General Appropriations Act provisions, and NBC Nos. 461 and 548.
7. Exercise prudence in the utilization of funds for expenses; and strictly

observe the provisions of COA Circular No. 2012-003 on the
disallowance and prevention of irregular, unnecessary, excessive,
extravagant and unconscionable expenditures.
468
VIII. HIGHLIGHTS OF
ACCOMPLISHMENTS OF
TOP TEN DEPARTMENTS
Department of Agriculture
DEPARTMENT OF EDUCATION (DepEd)
DepEd at a Glance
The Department of Education is considered as the biggest bureaucracy in the country managing
a large number of learners, personnel, and resources which are complemented with a large
share of the government’s annual fiscal budget. As an institution providing for the basic
education needs of every Filipino, DepEd is continuously pushing for a more sustainable,
inclusive and nurturing environment by providing a more child friendly schools managed by
competent teaching and non-teaching personnel who in turn will hopefully produce nation
loving, resilient, and life-long competent learners.
Currently, DepEd is comprised of 224 school divisions, and 2,584 school districts. The table
below shows the breakdown of schools, both public and private, offering the basic education
curriculum:
For SY 2017-2018, DepEd served 2,268,455 kindergarten, 143,483,620 elementary, 7,826,414

junior high school, and 2,778,460 senior high school learners. The total enrollment of
26,356,949 learners for the formal basic education is 5.50% higher than the previous school
year. This increase is due to the Grade 12 learners enrolled in the Senior High School program.
The table below shows the sectoral enrollment breakdown per level:
Moreover, DepEd also provided service to the non-formal learners under the Alternative
Learning System program. In 2017, the total enrollment for ALS reached 641,584 learners.
The table below shows the breakdown between the two previous school years for both formal
and non-formal basic education.
469
DepEd – Annual Accomplishments for CY 2017
The national enrollment for elementary (Kindergarten to Grade 6) slightly decreased by 0.8%.
The next table shows the enrollment comparison for elementary and their corresponding
growth rates per level.
On the other hand, the national enrollment data for SY 2017-2018 for Junior High School
showed a 3.46% increase from the previous year. The next table shows that almost all grade
levels had an increase in enrollment as compared to the previous school year.
Basic Education Sector Accomplishments
For Fiscal Year 2017, DepEd managed a total of Php 543,185,614,000 budget or 16.97% of
the national budget. This is comprised of Php 328,305,798,000 for Personnel Services (PS),
470
Php 135,639,591,000 for Capital Outlays, and Php 79,240,225,000 for Maintenance and Other
Operating Expenses (MOOE). This budget was 31.16% higher than the previous fiscal year’s
budget and posed a 3.6% share to the Gross Domestic Product (GDP) of the country.
By the end of 2017, DepEd obligated a total of approximately Php 29,473,000,000 for 2016
Continuing funds and Php 426,805,000,000 for 2017 current funds posing an 84.03% and
97.66% obligation rates respectively. Overall, DepEd has 96.65% Obligation Rate and 84.04%
Disbursement Rate for Fiscal Year 2017. The table below presents the financial
accomplishments of DepEd with their corresponding obligations and disbursements compared
against the General Appropriations Act allotment.
Financial Accomplishments1
For the year ending December 2017
It is also interesting to note that there has been an improved obligation rate for the past three
years, from 88% in 2015 to 97% for 2017. The increase in the obligation rate is part of DepEd’s
governance reforms on increasing budget spending through reforms on procurement activities,
and strengthened program implementation across all levels of governance.
1
Source: Revised Q4 2017 SAAODB as of June 19, 2018 (as submitted to DBM)
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Obligation Rates from 2013 to 20172
The 97% obligation rate of DepEd is due to the increased efficiency in the implementation of
its major programs and projects. With its intensive reforms to expedite procurement activities,
majority of the programs were able to commence their contract management processes thus
resulting to the obligation of the budget that will be disbursed next year once the delivery
commences. Majority of the procurement heavy programs posed a high obligation rates which
include DepEd Computerization Program (98.70%) and Basic Education Facilities Fund
(92.50%) while the other major programs like School MOOE (96.70%), Government
Assistance and Subsidies (94.70%), and School-Based Feeding Program (94.10%) also closed
the year with a higher obligated funds.
Financial Accomplishments of DepEd’s Major Programs3

For the Year Ending December 2017
Expanded Access to Basic Education
2 Ibid
3 Revised 2017 SAAODB
472
Improved Key Performance Indicators
For 2017, DepEd’s Participation Rate for Kindergarten increased from 65% in 2016 to 87% in
2017. On the other hand Junior High School participation also increased from 74% in 2016 to
76% in 2017. The improvement of the enrollment performance indicators is indicative of
improved holding power of our schools through an effective implementation of inclusion and
special interest programs. The succeeding table below shows the comparative Gross
Enrollment Ratio or the total enrollment in a given level of education, regardless of age, as a
percentage of the population which according to the national regulations should be enrolled at
this level, and the Net Enrollment Rate or the ratio of the enrollment for the age group
corresponding to the official school age in a given level to the population of the same age group
in a given year for the period of 2015 to 2017.
Continuous Implementation of the Senior High School
For 2017, DepEd welcomed the first batch of Grade 12 learners under its new K-12 Curriculum.
For this pioneer batch, a total of 1,252,357 learners were enrolled. The tables below show the
total enrollment for Grades 11 and 12.
It is also important to note that majority of the SHS students chose the Academic track posing
6.09% increase on the enrollment, followed by Technical-Vocational Livelihood track, Arts
and Design track and Sports track. For the Academic track, 33.76% of the students were under
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the General Academic strand, 23.59% under the STEM, 23.12% for ABM, 18.94% under
HUMSS, and 0.59% for the Maritime track. The tables below show the comparative enrollment
per track and strand of the SHS learners for 2017.
Alternative Learning System
A key priority program of the current Administration is the Alternative Learning System (ALS)
which aims to reach the marginalized learners through the ALS and ensure that the goals of
Education for All are met. ALS implementers use different modalities to reach all types of
learners which includes Basic Literacy Program (BLP), a program aimed at eradicating
illiteracy among out-of-school youth (OSY) and adults (in extreme cases, school-aged
children) by developing basic literacy skills of reading, writing, and numeracy, and
Accreditation and Equivalency (A&E) Program aimed at providing an alternative pathway of
learning for out-of-school youth and adults who are basically literate but have not completed
the required years of basic education mandated by the Philippine Constitution. For 2017, ALS
served a total of 641,584 learners.
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DepEd provided ALS education to out-of-school children, youth and adults. In 2017, 443,132
beneficiaries (69%) completed the program. The table below shows the ALS 3-year enrolment
and 2-year completers comparison.
To further intensify and expand the coverage of ALS, DepEd also issued the framework for the
pilot implementation of the Education and Skills Training component (ALS-EST) to produce
completers who are not only able to catch up with basic academic education, but have also
acquired technical competencies suitable for immediate employment. For 2017, it was piloted
to 146 schools to cater new ALS learners that will undergo the skills training component.
Updates on ALS Accreditation and Equivalency
The Accreditation and Equivalency Test (A&E) is a nationally administered test, which aims
to measure the competencies and life skills of those who have not attended or finished the
formal elementary or secondary education (D.O. 55, s. 2016). This assessment will allow the
learners to obtain certification of completion at different exits in Basic Education, which may
be used to access further education, job promotion, entry to job training, and employment.
The test covers 21st century skills based on the following Alternative Learning System Strands:
1. Communication Skills
2. Critical Thinking and Problem Solving
3. Sustainable Use of Resources and Productivity
4. Development of Self and S Sense of Community
5. Expanding One’s World Vision
The Bureau of Education Assessment (BEA) administered the 2016 A&E Test last November
2017 and the 2017 A&E Test in March 2018.
For the November 2017 A&E Test, there were 177,263 takers – 15,536 of which took the A&E
Test for Elementary Level while 161, 727 took the A&E Test for Secondary Level.
A&E Elementary had a percentage passing score of 42.56 % - with 6,952 passers while A&E
Secondary had a percentage passing score of 57.32% - with 97,634 passers.
The A&E Test administered last March 2018 had a total of 145, 494 takers – 15,204 took the
A&E Test for Elementary Level while 130,361 took the A&E Test for Secondary Level.
There were 9,162 who passed the A&E Test Elementary, or 57.21% while for A&E Secondary,
96,361 passed or 69.49%.
475
Madrasah Education Program
Madrasah Education Program (MEP) was formulated to provide quality basic education to all
Muslim learners in both public ALIVE schools and private madaris. This program aims to
ensure that all Muslim school children, Out-of-School Children (OSCs) and Out-of-School
Youths (OSYs) have access to education curriculum sensitive to the context and realities of
Muslim culture and Islam. In addition, the Madrasah curriculum contains Islamic Values and
Arabic Language. For 2017, DepEd provided service to a total of 1,359,185 Muslim learners
under the MEP which is 14% higher than the previous year.
The table below shows the breakdown of learners for 2017.
Indigenous People’s Education Program
In response to the right of Indigenous People (IP) communities to have an education that is
responsive to their context, respects their identities, and promotes the value of their indigenous
knowledge, skills, and other aspects of their cultural heritage, DepEd intensified its Indigenous
People’s Education Program (IPEd Program). Specifically, it aims to improve the
appropriateness and responsiveness of the curriculum; build the capacity of teachers, managers
and concerned personnel; support the development of culturally appropriate learning resources
and learning environment; and strengthen the policy environment supportive of IPEd. It is also
intended to address the learning needs of IP learners who have difficulty in availing basic
education services. DepEd served a total of 2,854,776 IP learners with a 27% increase for 2017.
Consequently, IPEd program provides contextualized IP education to 62,690 learners across
2,983 schools nationwide.
Special Education Program
Special Education Program (SPED) aims to provide access to basic education among children
with special educational needs by providing them with contextualized learning curriculum,
materials, and facilities through the formal system and other alternative delivery services in
education. In 2017, we served a total of 70,239 learners under the SPED Program.
476
Government Assistance and Subsidies
DepEd recognizes the complementarity between public and private educational institutions in
the educational system, specifically, the role of the private education sector as a key partner in
the delivery of quality basic education. As such, DepEd implements several programs under
Government Assistance and Subsidies (GAS, formerly Government Assistance for Students
and Teachers in Private Education) which aim to improve quality in private education and make
it a viable option for learners, in fulfilment of DepEd’s mandate to promote and make basic
education accessible to all Filipino learners.
Under the Education Service Contracting (ESC) program, financial assistance is extended to
learners and teachers in participating junior high schools, thereby expanding access to quality
education. Through the SHS Voucher Program (VP) in both private schools and state and local
universities and colleges (SUCs and LUCs) offering SHS, learners are provided financial
assistance enabling them to choose and pursue the SHS education that caters to their needs and
career goals. In 2017, DepEd implemented a new GAS program called the Joint Delivery
Voucher Program for Senior High School Technical-Vocational-Livelihood (JDVP-SHS TVL)
Specializations under which SHS learners enrolled in DepEd public schools and taking the
TVL track are provided financial assistance so they may take their TVL specializations in
eligible private schools and SUCs and LUCs offering the TVL track, or private technical-
vocational institutions. Pilot beneficiaries of this program will undergo assessment in 2018.
School-Based Feeding Program
SBFP covers all Severely Wasted (SW) and Wasted (W) Kindergarten to Grade 6 pupils for
SY 2017-2018. The program primarily aims to increase classroom attendance by 85% to 100%
and improve the children’s health and nutrition values and behaviour. Secondarily, it aims to
improve the nutritional status of the beneficiaries by at least 70% at the end of 120 feeding
days. A total of 1,624,263 learners were fed by SBFP for 2017. This total number of
477
beneficiaries is 5% higher than 2016. The table below outlines the number of learners that
undergo intensive feeding program for the two different school years.
Improved Quality and Relevance of Basic Education
Provision of Basic Education Resources
As part of the department’s strategic directions, DepEd provided several basic education inputs
needed for the implementation of various curricular programs in all schools nationwide. These
basic education resources are crucial for the continued promotion of learning by providing
learners with the basic educational needs that in turn will help in the achievement of improving
quality and relevance of the basic education. The majority of the programs focused on
redesigning its program implementation plans which include early procurement activities,
intensive program implementation monitoring and evaluation, and extensive field conferences
and consultation on budget utilization and program delivery. It is also expected that more of
the basic education resources that were procured from this year will be delivered to schools
starting early next year. The following tables show the comparative breakdown of resources
delivered from 2016 and 2017.
Improved Key Education Statistics
Because of the extensive basic education inputs program of DepEd, there has been a noticeable
improvement on the key basic education statistics. These statistics, majority of which improved
from the previous year, serve as a measure of the quality of the governance processes and the
effectiveness of the programs involved in the provision of the important education resources
needed by learners which include classrooms, teachers, and seats. The table below shows the
current ratios of the classrooms, teachers, and seats to each learner.
478
Improved Governance and Internal Processes
System Solutions: Roll-out of Program Management Information System and Learning

Resource Portal
With the objectives to support the effective and efficient monitoring of plan and program
implementation and aid policy formulation and decision making through quality and timely
data and information on plans, programs, and projects, a newly enhanced Program
Management Information System was rolled out to the Central Office up to the Schools
Division Offices in 2017. New facilities and modules such as Work and Financial Plan
Preparation, Activity Request and Authority to Conduct Request Facility, Preparation of
Project Procurement Management Plan and Annual Procurement Plan for Common-use
Supplies and Equipment were deployed to fast track and monitor the plans and progress of
implementation of programs, projects, and activities carried out in all levels of governance.
These advancements in the PMIS led to an organized gathering of information and systematic
data collection of basic education data on budget and plan execution. Moreover, it aided better
facilitation of report generation required by the department and oversight agencies.
In support to the efforts of the department to improve access and raise the quality of education,
promote professional advancement of the teaching personnel and offer easy access to the
identified needs of each local education, the Learning Resource Portal was rolled out to provide
access to quality learning materials and resources from Regional, Division, and Cluster/School
Level. It is designed to support increase distribution and access to learning, teaching and
professional development resources in all levels of governance of the department.
Emergency Response for Marawi & Biliran
In 2017, DepEd, led by the Disaster Risk Reduction Management Service of the Department,
conducted Brigada Eskwela in Marawi. Together with its partner agencies and other
organizations, this effort aims to expedite the revitalization of education following the armed
conflict that greatly damaged the city.
In November of 2017, the department deployed engineers who assessed schools in preparation
for the Brigada Eskwela sa Marawi (BESM) that was spearheaded by Secretary Leonor
Magtolis Briones in December of 2017. BESM was the flagship program of the department for
the recovery and rehabilitation of the Islamic City after the five-month siege that displaced
thousands of learners and teacher.
Consequently, the department also provided assistance in the Division of Biliran to regain the
normalcy in education in the area after the devastation that was brought about by the Tropical
Storm Urduja. Twelve (12) schools, in Biliran have been affected, two of which were
considered totally damaged and need relocation. In December of 2017, the regional office of
479
Region VIII launched the activity: “Biliran: Bangon, Barug, Balik Eskwela”. Through the
conduct of this activity, different education stakeholders were brought together to provide
support and help the Division of Biliran to rebuild and rehabilitate the schools for the learning
to continue.
Education Summit
In an effort to provide updates on the progress of the agenda by each agency involved in the
development and management of the trifocal educational system of the country, Education
Summit 2017 was convened by DepEd together with the other key agencies in the education
sector. Other government offices and various stakeholders were also gathered for their
feedbacks and inputs and elicited their commitment to help the department provide quality,
accessible, relevant, and liberating basic education for all.
Secretary Leonor Magtolis Briones presented the department’s challenges and directions in the
said summit. She also highlighted the continuous effort of the department in ensuring quality
education, as well as the importance of better coordination among government agencies,
industry, and the education sector in mitigating the questions and uncertainties concerning
education and its role in economic development. Additionally, she also emphasized the
department’s endeavor in responding to the rights, sensitivity to context, and inclusion through
the inclusive education.
External Partnerships
Brigada Eskwela is continuously being implemented to strengthen partnership with all

education stakeholders. The whole series of Brigada Eskwela 2017 kicked-off with the pre-
implementation in May and ended with the Regional and National Awarding Ceremony which
was conducted during the period of October and November 2017. The conduct of this annual
activity in all public schools aims to ensure involvement of the community, local stakeholders,
national and international organization, and all other parties who are interested to help all the
public schools in making their facilities ready for the opening of the schools.
For 2017, stakeholders’ support continuously increases surpassing the amount of resources
raised and generated in the previous years. December of the same year, an appreciation program
was held to honor the contribution of various partners from private and public sectors. The
department appreciated the efforts of almost 209 partners for their massive and generous
support to public schools for the betterment of the learning conditions of the Filipino learners.
480
Department of Public Works
and Highways
DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS (DPWH)
Financial Performance
As of December 31, 2017, the Department of Public Works and Highways (DPWH)
received total allotment releases of P675.0 Billion. Out of the total allotments, a
92.1 percent obligation rate was recorded equivalent to P621.9 Billion. This 2017
obligation performance recorded a significant increase of 14.6 percentage point over
the 2016 obligation rate of 77.5 percent. The DPWH exceeded its targeted obligation
rate of 85 percent based on its FY 2017 Financial Plan, and the five-year average
obligation rate of 80.2 percent from 2012 to 2016.
The significant improvement of the obligation performance of the DPWH was

mainly attributed to the acceleration of project implementation in view of the one-year
validity of the appropriations. Likewise, the Department adopted a number of
streamlined policies that improved the implementation of projects through effective
and efficient planning, monitoring, and scheduling.
It is noteworthy to mention that out of the total P675.0 Billion allotment received by DPWH
in 2017. 17.1% or P115.5 Billion are appropriations from Department of Education (DepED),
Department of Agriculture (DA) and Sugar Regulatory Administration (SRA). Moreover,
out of the P115.5 Billion allotments from other agencies, P97.2 B or 84.2% was only
transferred to DPWH in the last quarter of 2017.
481
DPWH – Annual Accomplishments for CY 2017
2017 ALLOTMENT
(Amount in Billion)
1st 2nd 3rd 4th Total
Quarte Quarte Quarte Quarte
r r r r
I. Current Appropriation 581.2
432.5 20.7 32.1 95.9
a. Regular Agency Fund 421.9 15.3 10.2 -2.8 444.6
b. Automatic Appropriation 3.6 0.2 8.5 0.7 13.0
c. Transferred Appropriation 5.9 0.2 115.5
12.2 97.2
1. DEPED (School Building) - 0.2 12.2 96.7 109.1
2. DA (Farm to Market Road) 5.9 - - - 5.9
3. Sugar Regulatory - - - 0.5 0.5
Administration (Farm to Mill)
d. Special Purpose Fund 1.1 5.0 1.2 0.8 8.1
II. Continuing Appropriation 4.1 14.0
0.8 - 9.1
a. Regular Appropriation 2.8 0.3 - 5.2 8.3
b. Special Purpose Fund 1.3 0.5 - 3.9 5.7
III. Extended Appropriation 79.8
92.5 - - 12.7
a. Regular Appropriation 88.0 - - 12.7 75.3
b. Special Purpose Fund 4.5 - 4.5
- -
675.0
529.10 21.50 32.10 92.30 0
Meanwhile, in terms of disbursement performance1, the DPWH disbursed P405.3 Billion in

2017. In terms of year-on-year disbursement performance, the disbursements in 2017 was
21.8 percent or P 72.8 Billion higher than the P 332.8 Billion disbursements made in 2016.
1
The disbursement figures cited in the paragraph are based on Financial Accountability Report (FAR) No. 4 - Monthly
Report of Disbursements (MRD). Likewise, the disbursement figures also include Tax Remittance Advice (TRA), Nonl-
Cash Availment Authority (NCAA), and Working Fund.
482
P211.343 Billion was disbursed for the Current Year's Budget. On the other hand, P33.909
Billion was disbursed for the Prior Year’s Budget, and P160.030 Billion was spent for Prior
Years' Accounts Payable of the Department - totalling to P193.939 Billion. The 2017 Current
Year's Budget disbursement is 23.9% or P40.7 Billion higher than the P170.6 Billion
disbursements made in 2016.
Despite the higher disbursement performance of the DPWH in 2017, the Department still
encountered the following bottlenecks: (a) unsettled right-of-way (ROW) issues; (b)
unprocessed vouchers due to lack of required documents for the settlement/payment of
progress billings or percentage completion of the project, i.e. occupancy/building permits and
BIR Form 0217 (Application for Contractor's Final Payment Release Certificate); and (c)
unfavourable weather conditions that resulted to delay in implementation for some projects.
Meanwhile, in terms of measuring the disbursement performance vis-a-vis Monthly

Disbursement Program (MOP), the DPWH recorded a utilization rate of 83.1 percent. This
was attributed to the establishment of an oversight and centralized control over the cash
requirements and programming of the implementing units.
The total budget obligated for the three major final outputs (MFOs) of the Department –
namely: National Road Network Services, Flood Management Services, and Maintenance
and Construction Services of Other Infrastructures - amounted to P296.2 billion, equivalent
to 96.5 percent obligation rate. The table below shows the allocation for the three MFOs of
the DPWH:
483
Major Programs (In Billion Pesos) Budget Utilization Rate

Allotment Obligation Disbursement Oblig. Disb.
MFO 1: National 213.3 205.8 99.2 96.5% 48.2%
Road Network
Services
MFO 2: Flood 73.6 71.0 39.0 96.5% 54.9%
Management
Services
MFO 3: 19.9 19.4 6.7 97.5% 34.5%
Construction and
Maintenance
Services of Other
Infrastructure
Total 306.8 296.2 144.9 96.5% 48.9%
As of December 2017
The DPWH – as the engineering and construction arm of the National Government – also
implemented other capital projects chargeable against transferred appropriations from other
agencies such as: (a) Basic Educational Facilities (BEF) of the Department of Education
(DepEd), (b) Farm-to-Market Roads (FMRs) of the Department of Agriculture (DA), and (c)
Farm-to-Mill Roads of the Sugar Regulatory Administration (SRA). In 2017, the total
transferred funds from these agencies amounted to P115.5 billion, of which P110.876 billion
was obligated, equivalent to 96.0 percent obligation ratio. However, in terms of the
disbursement-obligation ratio, the disbursement rate was only 6.0 percent of the obligated
budget (P6.7 billion). It is noteworthy to mention that out of the P115.5 billion allotments
from other agencies, 84.2% or P97.2 billion was received by DPWH only in the last quarter
of 2017.
Major Programs (In Billion Pesos) Budget Utilization Rate

Allotment Obligation Disbursement Oblig. Disb.
Farm-to-Market 5.9 5.494 2.291 93.13% 41.7%
Roads
Basic Education 109.1 104.890 4.396 96.1% 4.2%
Facilities
Farm-to-Mill Roads 0.5 0.492 0.013 98.4% 2.6%
Total 115.5 110.876 6.700 96.0% 6.0%
Note: The P96.7 Billion allotment for Basic Education Facilities and P0.5 Billion
allotment for Farm-to-Mill Roads were only transferred to DPWH in the last quarter of
2017.
Physical Performance
First under the National Road Network Services, the Department constructed, maintained,
and paved 2,672.149 kilometers of national road out of the committed target of 2,934.580
kilometers or 91.1 percent accomplishment. This accomplishment was higher compared to
47.9% percent (or 1,121.062 kilometers out of the committed 2,338.030 kilometers) in 2016.
On the other hand, the DPWH constructed 11,589.932 linear meters of bridges out of the
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target 5,626.750 linear meters or 27.0 percent accomplishment, which was higher compared
to 64.6 percent in 2016 equivalent to 4,594.732 linear meters of the committed 7,110.983
linear meters.
Second, under the Flood Management Services, the Department committed to construct and
maintain 1,755 flood control projects, of which 1,716 were constructed, maintained, and
rehabilitated; thus, recording an accomplishment of 97.8 percent. This was significantly
higher compared to 53.3 percent or 996 flood control projects out of committed 1,868 flood
control projects in 2016.
Lastly, under the Construction and Maintenance Services of Other Infrastructure, the DPWH
constructed and improved 284.342 kilometer-access roads leading to airports, sea ports, and
strategic tourism destinations out of the committed target of 379.230 kilometers, or 75.0
percent accomplishment. This was higher compared to 27.1 percent in 2016, equivalent to
167.164 kilometers of the committed 616.195 kilometers. The Department also constructed
1,896 septage/sewerage/rainwater collectors out of the committed 2,625 units or 72.2 percent
accomplishment.
485
In addition to the three MFOs under the Department’s regular mandate, other capital projects
transferred to the Department were also considered part of the DPWH's performance and
accomplishment. For Basic Educational Facilities Program of DepEd, the Department
completed the construction of 301 school buildings out of the 12,074 total targets. It is worth
mentioning that out of the total P109.1 Billion transferred appropriation from DepED, 89%
or P98.7 Billion was only downloaded to DPWH in the last quarter of 2017. Meanwhile, for
the farm-to-market roads (FMRs) of the DA, the Department completed 735 FMR projects
out of the 1,139 total targets. Lastly, the Department only received the P0.5 Billion
appropriation for farm-to-mill road projects from SRA in the last quarter of 2017.
While DPWH has been continuously improving and institutionalizing qualify of work by
establishing a Qualify Management System benchmarked with international standards and
rolled out the use of the Project and Contract Management Procedures and Application as a
tool for inspection and reflect the accomplishments of DPWH projects real-time, the agency
was confronted with many project implementation challenges in delivering some projects
right on time. Among which are issues on unresolved right-of-way problems and other legal
issues including relocation, procurement, coordination with relevant agencies for permit
acquisition, peace and order situation, inclement weather, late submission and approval of
some project modifications. The timely implementation of government projects are also
hampered by the presence of electrical, water and telecommunication facilities along road
right of way.
Although consultations are conducted by DPWH with the concerned LGUs and project
affected persons/residents, some residents/property owners are resistant to public negotiated
sale with most of the ROW acquisition ending into long-drawn expropriation cases.
The DPWH also faced procurement issues such as delayed biddings and delivery of
procured items during the project implementation. The Department shall pursue implementation
measures to fast track the procurement of its delayed programs, activities, and projects.
Lastly, the Department also encountered difficulty in securing approvals/clearances from

authorities and other agencies (MMDA, LGUs, DENR, etc.)
DPWH has taken bold steps to address this major concern by coming up on December 8,
2017 a clear, uniform, and user-friendly guide Right of Way Manual on the rules and
procedures for the acquisition by the DPWH of right-of-way for its infrastructure projects, in
accordance with the provisions of Republic Act No 10752 (ROW Act).
The Department has also improved the procurement process with the establishment of
Internal Documentary Tracking System to facilitate monitoring of in-coming and out-going
documents.
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Department of the Interior and
Local Government
DEPARTMENT OF INTERIOR AND LOCAL GOVERNMENT (DILG)
This 2017, the Department of the Interior and Local Government (DILG) pushed itself to the
limits for the full actualization of excellence while solidifying its ground as the country's prime
agent of good local governance, peace and order and public safety.
As the primary national government agency in charge of assisting the President in the general
supervision over local government units (LGUs), as well as, in promoting peace and order and
public safety and further strengthening local government capability aimed towards the effective
delivery of basic services to the citizenry, the Department took on the herculean tasks of
pushing to a higher level the implementation of intensive police operations to combat
criminality and illegal drugs, inviting active involvement and participation of the Filipino
people in local governance, adopting new measures and projects dedicated for local economic
growth and development, preparing LGUs to be disaster-resilient and climate change-adaptive
and providing social protection to the poor and marginalized.
Sustained the Drive for LGU Transparency, Accountability, Performance and Active
People’s Participation in Local Governance
A. Seal of Good Local Governance (SGLG)
"The Seal of Good Local Governance

(SGLG) symbolizes integrity and good
performance through continuing
governance reform and sustained local
development. It is a progressive
assessment system adopted by the
Department to give distinction to
remarkable local government
performance across several areas."
This was exactly the tool that the

Department used to assess the
performance of the 1,671 LGUs (81
provinces, 144 cities and 1,446
municipalities) including 79 LGUs in
ARMM. Of this number, a total of 449
LGUs (29 provinces, 61 cities and 359
municipalities) have successfully hurdled
the high SGLG performance bar, a
remarkable feat since this is 47% higher
than the 306 LGU awardees in 2016, with
more than 50% of them "new passers'
B. Full Disclosure Policy (FDP)
The Department's continued monitoring of LGU compliance with the Full Disclosure
Policy (FDP) has sustained the drive for transparency and accountability. Through this
policy, LGUs are encouraged to fully disclose to their constituents and the general public
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DILG – Annual Accomplishments for CY 2017
important financial documents, through

the web, print media and in conspicuous
places in their areas. For the 4th quarter
of this year, a total of 1,564 (76
municipalities) or 98% of the 1,592 total
LGUs nationwide, excluding ARMM,
are compliant with the policy. Of this
number, 1,381 LGUs or 88% are fully
compliant. At the barangay level 38,089
or 91% of the 42,036 total barangays
nationwide including those in ARMM
are FDPcompliant, with 31,392 or 75%
being fully compliant.
Compliance with the FDP, along with

adherence to government accounting
and auditing standards, are among the
prerequisites in order to pass the
Financial Administration Core
Assessment Area of the SGLG.
C. Performance Challenge Fund (PCF)
The conferment of the SGLG comes with more than just recognition. The awardees are also
provided with the Performance Challenge Fund (PCF) which they shall use to fund and
implement development programs and projects related to local economic development
disaster risk reduction and management, ecological solid waste management and the
Millennium Development Goals/Sustainable Development Goals (MDGs/SDGs). Since
the PCF was first introduced in 2010, the DILG already granted Php5.914 Billion in PCF
subsidy to a total of 1,250 LGU-SGH/SGLG passers which enabled them to implement
2,922 projects.
Out of the 2,922 PCF projects, 2,673 or 91% are now 5 complete and already benefitting
the people, while the remaining 249 or 9% are either on-going or complying with
administrative requirements. The completed projects include local access roads, urban
roads and bridges, maternal/health birthing clinics, water supply systems, evacuation
centers, multi-purpose livelihood centers, public markets, school buildings, flood control
sanitary landfill etc.
For CY 2017, a total of 449 SGLG passers (29 provinces, 61 dries and 359 municipalities)
were direct beneficiaries of the PCF amounting to Php951.4 million. These LGUs are now
in the process of completing the necessary administrative requirements for them to
commence the implementation of their chosen projects.
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D. Strengthening of Local Institutions
DILG continued to strengthen the

Local Development Council
(LDC), Local Peace and Order
Council (LPOC), and People’s
Law Enforcement Board (PLEBs)
to make them active partners in the
effective monitoring of projects as
well as the establishment of checks
and balances in local governance.
For 2017, a total of 1,405 (77

municipalities) or 82% of the
1,715 LGUs nationwide including
ARMM are found compliant with
the minimum requirements of
LDC functionality.1
The POCs were guided by the DILG in the development of their three-year Public Order
and Public Safety Plan (POPSP) and have it incorporated in the respective LGU
Comprehensive Development Plan through the issuance of necessary policies, such as the
Compliance to Peace and Order and Anti-Illegal Drug Related Issuances roles and
responsibilities of the Peace and Order Councils2 and support to the Integrated Drug
Monitoring and Reporting Information System (IDMRIS).3 We also developed two POC
accomplishment monitoring systems, namely the POPSP Policy Compliance Monitoring
System (POPSP PCMS) and the Peace and Order Information System to effectively track
down and monitor the implementation of POPS Plan and to keep a database of all members
of the POC and POC TWG and the gathering of data on illegal drugs, insurgency and
violent extremism, respectively. As a result, a total of 1,706 or 99.5% of 1,715 target LGUs
successfully developed their respective 3-year Peace and Order and Public Safety (POPS)
Plan 2017-2019 as of December 31, 2017.
For 2017, the PLEB program mainly focused on the conduct of orientation-enhancement
training to 1,568 or 95% of 1,649 C/Ms, provision of technical assistance on the creation
of dedicated PLEB Office and conduct of ocular inspections and inventory of cases to 304
LGUs.
E. Information and Awareness on Federalism
In view of the President's call to undertake a nationwide information campaign on

Federalism, the Department conducted Information and Awareness Training Program on
Federalism attended by a total of 295,354 participants from the 18,956 barangays. Various
1
The minimum requirements for LDC functionality include the adequate representation of non-government organizations, formulation of
long-term, medium-term, and annual socioeconomic development plans, establishment of an executive committee and secretariat, and
conduct of LDC meetings.
2
DILG MC No. 2017-67: Amending DILG Memorandum Circular No. 2017-64,Entitled "Compliance to Peace and Order and Anti-Illegal Drug
Related Issuances"
3
DILG MC No. 2017-103: Support to the Integrated Drug Monitoring and Reporting System (IDMRIS)
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information, education and communication (IEC) materials on Federalism in the form of

627,596 brochures, 227 tarpaulins, 300 booklets, 8 audiovisual presentations, one jingle,
and 3,500 posters were also printed and distributed to the general public for information
dissemination.
Ensured Peace and Order and Public Safety in the Communities
In response to the marching order of President Rodrigo Roa Duterte to address the worsening
problem of illegal drugs in the country, the PNP waged an all-out war against illegal drugs
through the implementation of PNP Campaign Plan against Illegal Drugs: Double Barrel,
Double Barrel Alpha and Double Barrel: Reloaded aimed to clear all drug-affected
barangays and neutralize illegal drug entities and organized groups through the conduct of
intensive clearing operations nationwide.
For CY 2017, the PNP worked for the

surrender of 114,701 drug personalities,
thus bringing the total number of
surrenderers to 1,263,934 since the anti-
illegal drug campaign started. Also, the
39,121 police operations conducted this
year resulted to the arrest of 63,025, death
of 1,493 drug personalities and confiscation
of illegal drugs with an estimated value of
Php13.511 Billion.
The campaign, along with other major anti-

criminality campaigns of the PNP, have
yielded positive results as evidenced by the
reduction in the total crime volume by
10.98%4 (from 584,883 incidents in 2016 to
520,641 incidents in 2017) and
improvement in crime clearance efficiency
by 4.88%5 and crime solution efficiency by
4.08%.
Index Crimes, (crimes considered serious in nature and occurring with sufficient frequency and
regularity that they are considered index to the crime situation in a given area) has decreased
by 22.85% or 32,039 lower than last year's reported figure of 139,577. Non-index crimes,
(crimes in violation of special laws) also registered a 7.23% decrease with 413,103 crimes
recorded in January to December 2017, in contrast to the 445,306 crimes recorded in the same
period of last year.
4
Crime Volume is the number of crime incidents committed in a given area over a period of time which include the index and non-index
crimes. CV = Index Crimes Non-Index Crimes.
5
Crime Clearance Efficiency (CCE) is the percentage of cleared cases out of the total number of crime incidents handled by law enforcement
agencies for a given period of time (CCE 12 = Cleared Cases/Crime Volume x 100). On the other hand, Crime Solution Efficiency (CSE) is the
percentage of solved cases out of the total number of crime incidents handled by law enforcement agencies for a given period of time. (CSE
= Solved Cases/Crime Volume x 100.
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For 2017, a total of 39,945 or 95% of the

42,036 barangays nationwide including
ARMM have organized/reorganized their
BADACs. 8 of this number, 17,663 or 44%
of these BADACs have formulated their
Action Plans. Also, we conducted a National
Orientation Training intended to equip the
77 Regional BADAC Focal Persons,
Provincial Focal Persons and members of
the partner agencies like PDEA, PNP, DDB,
CHR and DSWD participants with knowledge in providing technical assistance to the
barangays in the implementation of the barangay drug clearing operations and formulation of
BADAC Plan of Action.
Barangays were also tapped by the DILG in

the implementation of its Mamamayang
Ayaw sa Anomalya, Mamamayang Ayaw sa
Iligal na Droga (MASA MASID), a multi-
sectoral and mass-based program that
encourages volunteerism and participation of
local stakeholders, volunteers, civic
organizations, faith-based organizations and
the private sector for a more inclusive and
efficient implementation of the campaigns
against criminality, corruption and illegal
drugs. This resulted in the establishment of
MASA MASID Teams in 41,679 barangays,
organization of Expanded Ugnayan ng Barangay at Simbahan (UBAS) Technical Working
Groups in 1,578 cities and municipalities (CMs) and the enrollment of 363,805 MASA MASID
volunteers.
To complement the efforts of the barangays in the peace and order campaign is the 911
Emergency Hotline Service, which serves as the direct access of the people to the government
by serving as a quick response mechanism from the police, fire department, emergency medical
services and other forms of emergencies. For 2017, a total of 3,604,848 legitimate calls were
received or an average of 9,876 calls received per day using the 911 hotline. The average
response time for all legitimate calls is 8.4 minutes.
Illegal drugs and criminality in the country were not the only challenges that confronted the
Department in 2017. The terror crisis in Mindanao, specifically in Marawi City and nearby
municipalities put to the test the Department's capacity to maintain peace and order in the
country.
Since the rebellion started in May and ended in October, 2017, nearly 1,000 people were
reportedly killed in the conflict including more than 800 terrorists, 47 civilians and 163
government troops!' On the side of the PNP, a total of 35 Maute ISIS members were arrested,
141 hostages were rescued and 106 cadavers were recovered while various firearms and
ammunitions were confiscated such as 47 assorted firearms, 594 unexploded ordinances
(UXOs), four (4) rocket propelled grenades (RPGs) and 8,273 rounds of assorted ammunition.
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Encouraged LGUs to be more Business-Friendly and Competitive
The Department continued to provide assistance and support to LGUs to make them attractive
havens for business and investment. This is through the promotion of the Streamlining of
Business and Building Permits and Certificate of Occupancy. The DILG-DICT-DBM Joint
Memorandum Circular 01-2016 or "Revised Standards in Processing of Business Permits and
Licenses in all Cities and Municipalities" introduced the reforms and new standards to follow
in the processing of business permit applications and renewals which now use a single, unified
form, includes three or less processing steps, requires two signatories or less for approval, and
takes two days or less processing time. A total of 1,424 cities and municipalities (excluding
ARMM) have responded to the new BPLS standards as follows:
In totality, 52% or 788 of the 1,516 cities and

municipalities are now compliant with the standard
reforms based on JMC 01-2016 for new business
applications and 57% or 868 cities and municipalities
for renewal of business applications. This program
undoubtedly improved business permit licensing
processing system nationwide that led to an increase in
the number of registered business establishments and
revenue from the collected fees and taxes. Overall, a
total of 1,370,258 business establishments have
registered in 2017 and Php46.5 Billion earnings were
collected from business taxes, fees and charges.We also
conducted various training relative to the new BPLS
standards such as:
• BPLS User Training attended by 10 pilot
LGUs;
• Coaching and mentoring on BPLS automation attended by 80 CMs in which 65 of
them have already automated their BPLS;
• Training on enhanced BPLS standards participated by 160 coaches from the DILG,
DTI, DICT, BLGF and BFP; and
• Orientation on new BPLS attended by 151 participants from 44 LGUs.
492
Improved People’s Access to Social Services and Mobility for Economic Growth
The Department implemented programs aimed to improve the people's access to social services
and mobility for economic growth especially intended for the poor and marginalized
communities.
A. Sagana at Ligtas na Tubig sa Lahat (SALINTUBIG) Program
Since the Department took over the implementation of the SALINTUBIG program in 2012,
a total of 882 water projects were already completed in 480 waterless municipalities and
are now benefiting 427,916 households/families while the remaining 1,177 are in various
stages of completion.
The Department also implemented the Joint Programme on Promoting Water Sanitation
Access, Integrity, Empowerment Rights and Resiliency Project funded by the Spanish
Government in partnership with the United Nations agencies. The project covers 10
waterless municipalities in Region V, VIII & IX and is aimed to promote democratic and
transparent water and sanitation governance system, improve access to water and sanitation
services, ensure healthy lives through sanitation and hygiene education and promote
integrated water governance and climate change adaptation.
B. Integrated Approach on Safe Water, Sanitation and Hygiene (iWaSH)
All of the 10 target waterless municipalities have adopted the iWaSH. This means that
iWaSH is now integrated in their medium and long term (5-10 years) plans and investment
programming. The Department also provided assistance in the establishment of three
Regional Water and Sanitation (WATSAN) Hubs that will help these recipient
communities and LGUs manage and sustain their water and sanitation projects. Various
knowledge products on iWaSH such as Integrated WASH Assessment Tool, Water Quality
Monitoring and Risk Assessment Water Safety Planning Results-based iWaSH Sector
Planning Sanitation Programming etc. were likewise developed to serve as ready references
by these Regional Hubs in the conduct of capacity development activities to these LGUs
C. Assistance to Disadvantaged Municipalities (ADM)
After five years of implementation (2013-2017), the Program has completed 5,316 or 52%
of the total 10,177 sub-projects comprising of 2,564 water facilities, 1,409 local access
roads and 1,343 other infrastructure projects. On the other hand, the remaining 2,914 sub-
projects are on their various stages of completion. Through these sub-projects, the life of
the people at the local levels steadily progressed.
The DILG was tasked to monitor the implementation of priority sub-projects of the
municipalities recipient of the Local Government Special Fund (LGSF). So far, a total of
2,127 or 59% of the 3,592 sub-projects were completed while the remaining 1,465 are on
various stages of completion. These sub-projects were comprised mainly of water projects,
flood control mitigation projects, evacuation center, acquisition of rescue vehicles and
DRRM equipment, among others.
493
D. Payapa at Masaganang Pamayanan (PAMANA) Program
The Department played a major role in the implementation of the Payapa at Masaganang
Pamayanan (PAMANA) Program, a peace and development program implemented in
identified conflict-affected areas. Since the project was implemented in FY 2012 up to FY
2017, a total of 638 or 87% of 738 sub-projects were already completed and now provide
road access and livelihood opportunities to 1,113,595 households. With these projects in
place, it is expected that there will be peace and order in these recipient LGUs and the
people can start rebuilding and improving their lives.
E. Capacitating LGUs on Resettlement Governance Project
The Department strengthened the technical and financial capacities of LGUs on

resettlement governance through its Capacitating LGUs on Resettlement Governance
Project. Thus, DILG provided Resettlement Governance Assistance Fund (RGAF)
amounting Php274.780 Million to 12 recipient LGUs in Regions III, IV-A and NCR to
serve as augmentation support in providing resettlement sites with basic services such as
but not limited to dump trucks, CCTV, outposts, vehicles and streetlights; and as
transitional fund for LGU operational costs and community development projects.
Built Disaster-Resilient and Climate Change Adaptive LGUs
The Department continued to focus its disaster-preparedness efforts in 68 provinces and their
cities and municipalities located in areas covered by the 18 Major River Basins (MRBs),
highly-vulnerable to shocks and disasters and in the Eastern Seaboard.
A. Operation LISTO (Alert)
This year, the LISTO Program conducted a number of trainings to improve LGU diaster
preparedness. Among the program's accomplishments are:
• Under the LISTONG Pamahalaang Lokal component, 23 LGUs participated during the
Mainstreaming Climate Change Adaptation (CCA) and Disaster Risk Reduction (DRR)
in Comprehensive Development Plan. Also, 97 participants attended the Trainor's
Training on Comprehensive Development Plan (CDP) updating.
• Technical Assistance on Climate Change Expenditure Tagging was extended to 19
LGUs. Six (6) meetings were conducted on the Strengthening of DRR CCA Operations
Disaster Preparedness while 41 participants from Local Resource Institutes (LRO
attended the activity on Engaging LRIs in CCA-DRR.
• Collaboration among stakeholders to strengthen LGUs capacities against climate
change was a theme in the Regional Planning for the Provincial Preparedness and
Partnership Dialogue where a total of 2,430 participants from 312 LGUs participated.
Also part of the collaboration with stakeholders is the localization of the National
Disaster Preparedness Plan (NDPP) that was attended by 587 participants.
• Under the LISTONG Pamayanan component, a training-workshop on Community Drill
was attended by 233 participants from 5 LGUs. It was followed by the roll-out to the
MRBs of Community Drills for Earthquake /Tsunami which was attended by 4,024
participants from 636 LGUs. Thirty-six (36) trainees also formed a pool of facilitators
while 146 attended the CBDRRM Training for DILG officers. Further, promotional and
media activities under the Project iAct was conducted with 42 participants.
494
B. Mainstreaming of DRR-CCA in Local Development Planning Project
The DILG provided technical assistance on Climate and Disaster Risk Assessment (CDRA)
to 670 LGUs in which 45% or 304 have utilized the CDRA Results in the identification of
DRR programs/projects, while 46 (15%) are in the process of formulating/updating their
risk-informed comprehensive development plans (CDPs). Also, 193 (63%) LGUs were
provided direct coaching by a pool of experts on the assessment and enhancement of CDRA
results. Of this number, 166 LGUs proceeded to integrating CDRA results in the CDP and
in the preparation of DRR-CCA program design and project briefs.
C. Strengthening the Capacities of Philippine Local Governments in Disaster Risk Reduction
This aimed to improve the capabilities of LGUs and communities in strengthening the
system of disaster risk reduction in the Philippines. Covered by the project are provinces
which are highly vulnerable to shocks and disasters, within the Major River Basins and/or
Eastern Seaboard and with high poverty incidence and magnitude. So far, funds amounting
to Php9,107,400 were already downloaded to the provinces of Zambales, Davao Occidental
Northern Samar and Negros Occidental for their disaster-related capacity development
activities.
D. Manila Bay Clean-up, Rehabilitation and Preservation Project
In 2017, these LGUs have inspected a total of 169,623 commercial establishments, 4,227
factories and 1,666,605 homes along riverbanks and shorelines of Manila Bay waterways,
of which 85% or 1,566,167 have been found compliant with the requirements of the SC
directive. On the other hand, 48,886 establishments have recently complied after
notification of non-compliance.
The Department continued its repair and rehabilitation services in LGUs of Regions IV-B, V,
VI, VII and VIII which were badly hit by Yolanda and the strong earthquake that rocked mostly
Bohol and Cebu in an effort to accelerate economic activities in these affected areas.
Through the Bohol Earthquake Assistance (BEA) project, a total of 1,076 projects worth
P2.413B were implemented in 53 Bohol and Cebu LGUs, with 998 of them already completed
while the remaining 78 nearing completion. Among the reconstructed and rehabilitated projects
are barangay facilities, bridges, civic centers, and municipal buildings, market places and water
systems. These structures were made disaster-resilient to minimize the effects of earthquakes
that may occur in the future.
Meanwhile, Project RAY or the Rehabilitation and Reconstruction Assistance for Yolanda-
Affected Areas Project was another recovery and restoration effort of the Department for the
Typhoon Yolanda-affected areas that provided financial grant assistance to affected LGUs with
consideration on Build Back Better (BBB) designs and standards to ensure safer and disaster-
resilient public infrastructures. The project was implemented in three batches, i.e., Batch 1
pertains to the restoration or reconstruction of municipal halls, public markets and civic centers,
Batch 2 is intended for barangay facilities such as barangay halls, barangay civic centers and
barangay day care centers; and municipal facilities such as municipal halls, civic centers and
public markets and Batch 3 involved the reconstruction of province / city / municipal / barangay
495
facilities, justice halls, bus terminals, flood control and drainage systems and water supply
projects.
So far, the following number of projects were completed: Batch 1-306 (99%) of 307 projects;
Batch 2 3,282 (94%) of 3,478 projects and Batch 3-335 (57%) of 587 projects. The contribution
of the RAY Project to the development of human resources, society and the economy in the
country was recognized by no less than the Japan International Cooperation Agency (JICA),
an international institution committed to the promotion of global human security and quality
growth. Hence, last October 3, 2017, the DILG humbly received the JICA President Award.
Issued Policy and Legislative Reforms in Support of Local Autonomy
Consistent with its mandated function of assisting the President in the general supervision over
LGUs, the Department issued various policies aimed to improve local governance and promote
local autonomy. Among these relevant policies include the following:
• PNP, BFP, and the LGUs to take necessary actions on regulation and control on the use of
firecrackers and other pyrotechnic devices especially during the celebration of special
occasions. (MC No. 2017-168 dated December 19, 2017);
• LGUs to support Executive Order No. 26 titled "Providing for the establishment of smoke-
free environment in public and enclosed places. (MC 2017-147 dated November 3, 2017);
• LGUs to suspend imposing various fees, taxes and other charges on transporting goods and
passengers carried into or out, or passing through their respective territorial jurisdiction.
(MC No. 2017-23 dated February 6, 2017);
• Local government officials and employees to strictly observe and comply with the
prohibition against entering, staying and/or playing at gambling casinos (MC No. 2017-20
dated February 2, 2017).
Ensured the Attainment of the Mandates of the DILG Attached Agencies:
A. NATIONAL POLICE COMMISSION (NAPOLCOM)
Supervision and Control over the PNP
For 2017, NAPOLCOM has issued 11 resolutions withdrawing the deputation of 168 LCEs.
Actions taken against these erring officials were grounded on their involvement in the
illegal drugs trade, or engagement in acts inimical to national security, and peace and order,
or abuse of authority. This has brought to 186 the total number of LCEs that were
withdrawn of their deputation ever since President Duterte has ordered a renewed
crackdown on illegal drugs and criminality.
NAPOLCOM also conducted various monitoring activities on the following

• Alleged involvement of 224 PNP members in illegal activities, organized crimes and
other forms of misbehavior, as contained in 110 reports gathered from quad-media,
walk-in complainants, letter complaints and other sources;
• Alleged human rights violations committed by 83 PNP members as indicated in the 63
reports received through complaints and referrals from other agencies and other
sources;
• Status of 3,471 administrative and 728 criminal cases which were recorded for
disposition during the period under review. OF the recorded cases, 1,666 administrative
cases and 152 criminal cases were disposed of;
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• Extent of participation of 862 LCEs in police administration in their territorial

jurisdiction as deputies of NAPOLCOM; and
• Compliance of 705 PNP offices/units with NAPOLCOM inspection and audit
recommendations.
Also, NAPOLCOM conducted inspection and audit in 2,276 PNP offices/station/units

nationwide, allowing them access to updated information on the prevailing situation on the
ground pertaining to police personnel, facilities and equipment Of the total, 2,089 were
subjected to regular/announced inspections and 187 were unannounced/spot inspections.
Aside from the PNP entrance and promotional examinations, NAPOLCOM also
administered the Police Executive Service Eligibility (PESE) examination. Passers to this
examination are granted third level eligibility which is appropriate for the ranks of Police
Senior Superintendents and higher. OF the 624 examinees, 74% or 463 passed the written
examination while only 19.88% or 100 passed the interview.
NAPOLCOM also implemented welfare programs for the benefit of police officers injured
or killed during the performance of duty. Welfare benefit packages such as payment of
medical expenses, gratuity, burial and pension were provided to the injured or fallen police
officers, while
B. PHILIPPINE NATIONAL POLICE (PNP)
Crime Prevention, Suppression and Investigation Services
For this year, overall police visibility has improved as made evident by the 16% increase
in the number of manhours spent for law enforcement operations, from 11,451,581 in 2016
to 13,240,143 in 2017. Also, a total of 214,546,601 manhours of foot patrols and
109,461,258 man-hours of mobile patrols were devoted to sustain police presence on the
streets. As a result, the efficacy of police operations was ensured as 100% of the crimes
reported especially in the urban areas were addressed by the police within the ideal response
time of 15 minutes.
Campaigns against other crimes such as carnapping, kidnap-for-ransom, illegal gambling,

illegal possession of firearms, criminal gangs and wanted persons were also intensified by
the PNP resulting in the following accomplishments:
1. Campaign against Carnapping
Carnapping incidents were reduced by 31% from 9,334 in 2016 to 6,464 in 2017 broken
down as follows: 34% for motor vehicles (MVs) from 773 in 2016 to 507 in 2017 and
30% for motorcycle (MCs) from 8,561 in 2016 to 5,957 in 2017. Of the total reported
incidents, 246 MVs and 1,358 MCs were recovered which translates to a recovery
efficiency rating of 25%. In addition, 1,061 suspects were arrested and 775 cases filed
in courts.
2. Campaign against Kidnapping-for-Ransom (KFR)
Operations conducted against KFR resulted in the arrest of 86 personalities, surrender

of 3 and killing of 17 in which 20 cases were solved and two cases were cleared. This
497
campaign also resulted in the arrest of SPO3 Ricky Sta. Isabel and surrender of SPO4
Roy Villegas and Ramon Yalung on January 20, 2017, and PSupt. Rafael P Dumlao on
April 25, 2017, who were involved in the kidnapping and murder of Korean national
Jee Ick Joo.
3. Campaign against Illegal Gambling
The 14,919 operations on illegal gambling resulted in the confiscation of Php11.7

million worth of bet money and other gambling paraphernalia; arrest of 31,794 suspects
and the filing of 12,357 criminal cases in courts.
4. Campaign against Loose Firearms
Efforts to account loose firearms resulted in the confiscation, recovery and surrender of
11,837 small arms and light weapons (SALW). The campaign also resulted in the arrest
of 9,344 suspects and filing of 6,399 criminal cases in court for violations of Republic
Act No. 10591.
5. Campaign against Criminal Gangs (CGs)
As a result of police operations against criminal gangs, 64 gangs were disbanded, 1,366
members arrested and 55 killed nationwide. Also, 624 firearms were
confiscated/recovered and 516 cases were filed in courts. Notable accomplishment on
this campaign was the arrest of Solayman Dimaporo @ Jomar, Muslimen Utap y
Dimawan, a High Value Target level 2 suspect and Team Leader of the dreaded
notorious Martilyo Gang/UTAP group. Subject was arrested at the vicinity of Saging
and Strawberry Streets, Brgy. CAA, Las Pinas City on May 9, 2017.
6. Campaign against Wanted Persons and Other Wanted Persons
The crackdown on the county's Top Most Wanted Persons (TMWPs) resulted in the
arrest of 22 and the death of two in police operations. Notable accomplishment was the
arrest of Willy Sagisag wanted for multiple murder and frustrated murder, a national
level most wanted person with a reward of Php600,000.00 in Sitio Malusong Brgy
Antonio Canao, Lubuagan, Kalinga on February 21, 2017. Two MWPs affiliated with
ASG and cohorts covered by DND-DILG Joint Orders with a total reward of
Php12,400,000.00 were killed during police operations. Also, two MWPs affiliated
with the CPP/NPA/NDF (CNN) covered by DND-DILG Joint Orders with a total
reward of Php7,000,000.00 were arrested.
On the other hand, operations conducted against Other Wanted Persons (OWPs)
resulted in the arrests of 42,297, surrender of 921 and death of 38 in police operations.
7. Campaign against Terrorism
As a result of the PNP's campaign against terrorism, terrorist attacks were thwarted with
the arrest of PSupt Maria Cristina Nobleza, Reenor Lou Dongong aka Kudri/Renren,
Judith Dugan and Alima Dugan Santos, allegedly linked to the Abu Sayyaf Group
(ASG), who were arrested in a checkpoint in Brgy. Bacani, Clarin, Bohol on April 22,
2017. Also, because of the PNP's vigilance, the planned tenor attacks in Metro Manila
to disrupt the holding of the 31st ASEAN Summit were foiled and three suspected ASG
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members, namely Abdulgaffar J. Jildri @ Abu Bakar Jildri, Alim Sabtalin and Sadam
Jhofar were arrested.
Also, various awards and recognitions were conferred by PNP to those who have
rendered exemplary performance and/or made contributions to the success of the
organization.
While the PNP reward its performing police personnel, it is also committed to cleanse
its rank by getting rid of the undesirables and incompetent personnel It activated the
Counter-Intelligence Task Force (CITF) hotline 09989702286 aimed to receive
complaints and information from the public about erring policemen. As a result,
administrative charges were filed against 1,648 PNP personnel for demonstrating deeds
and behaviour unbecoming of police officers. Of this number, 586 were meted the
penalty of dismissal from service for their involvement in illegal drugs trade and/or
found users of illegal drugs while 761 were suspended and the remaining 301 were
either demoted, forfeited of pay, reprimanded/restricted or withheld of privileges.
C. BUREAU OF FIRE PROTECTION (BFP)
Fire Prevention and Suppression Services
Mandated to provide effective fire prevention services aimed to protect the people from
destructive fires, the BFP conducted inspection of business establishments and ensured
their compliance with the Fire Code. Those proven compliant with the Code were duly
issued with Fire Safety Inspection Certificate (FSIC).
In the area of fire suppression, the number of fire incidents responded and suppressed by
BFP nationwide has decreased by 26.40%, from 19,292 reported in CY 2016 to 14,198 this
year. However, even with prompt responses by BFP, the number of casualties and estimated
amount of damages have increased by 7.02% and 155.28%, respectively.
D. BUREAU OF JAIL MANAGEMENT AND PENOLOGY (BJMP)
Inmates Safekeeping and Development Services
The Bureau of Jail Management and Penology (BJMP) in order to maintain utmost secret
in all jails nationwide has intensified its implementation of tactical strategies to prevent the
entry of prohibited drugs and contrabands within jail facilities. Strict jail control and
inspection especially on highly populated jails were conducted to provide safety and
protection to jail inmates. This resulted to the confiscation of 103,919 units of contraband
prior to entry to jails and 143.8 grams of shabu with 2,725 drug paraphernalia during the
conduct of Oplan Greyhound.
In order to improve the living conditions for the Persons Deprived with Liberty (PDL)
within the facilities, the BJMP employed the Therapeutic Community and Modality
Program (TCMP). The TCMP is a psychological treatment process that focuses on five
main aspects of the subjects' personalities as target for change, namely behavioral,
psychological, cognitive, spiritual and vocational-survival Recognizing the effectivity of
this rehabilitation method, BJMP worked for and successfully made all 481 BJMP manned
jails nationwide TCMP-compliant.
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To address the overcrowding of jails, the BJMP initiated a number of decongestion

programs. With the BJMP's efforts in the continuing modes of releases of PDL, a total of
36,330 inmates were released within the prescribed period. Of this number, 25,828 PDL
were released through various modes such as Republic Act 6036 (Release on
Recognizance), Republic Act 10707 (Probation Law), Republic Act 9344 (Juvenile Law),
release on bail, served sentence, dismissed case, and acquittal Some 2,292 inmates were
also released through paralegal-assisted services as 2263 were granted with Good Conduct
Time Allowance (GCTA) and 5,947 were transferred to other institutions.
With the overwhelming number of surrenderers affected by the campaign against illegal
drugs, the number of inmates has ballooned, from 126,946 inmates in 2016 to 146,302
inmates being held in the 481 BJMP jails nationwide. This has increased the congestion
rate to 612% in 2017 as compared to the 511% in 2016. The BJMP is properly addressing
this problem with the construction, expansion, and repair of jail facilities. For 2017, 97 jail
facilities have been improved; 23 of which have undergone expansion while 74 have
undergone repairs. For the same purpose, the BJMP also worked on the construction of
additional facilities. To date, two (2) perimeter fences have been completed, 31 jail facilities
are undergoing construction, and 31 other facilities are to be constructed.
E. PHILIPPINE PUBLIC SAFETY COLLEGE (PPSC)
Professionalization of the Police Force and Public Safety Personnel and Services
The PPSC is mandated by Section 66 of Republic Act 6975

as the premier educational institution for the training human
resource development and continuing education for all the
personnel of the PNP, BFP and BJMP.
In an effort to institutionalize a highly efficient, competent,

credible and professionalized corps of peace and order and
public safety personnel, the PPSC serves as the premier
educational institution for the continuing education, and
capacity development of PNP, BJMP, and BFP personnel.
PPSC assisted the DILG in the implementation of its major programs/projects such as
Operation LISTO and MASA MASID. A total of 720 barangays in Regions 5, 8, 11, and
13 participated in the simulation drills conducted by the PPSC for the Operation LISTO
while it conducted the training of trainers in Preventing and Countering Violent Extremism
(PCVE) held from November 27 to 29, 2017 for MASA MASI D. A total of 173 individuals
took part in the said activity. Consequent cascading activities were conducted by the RTCs
and by the end of 2017, a total of 7,803 individuals composed of PPSC personnel, students,
DILG officers, MASA MASID volunteers, barangay officials, and personnel from other
agencies participated in the PCVE activities. The Center for Violent Extremism and
Insurgency Strategic Studies was also inaugurated at the National Police College on
December 20, 2017.
Meanwhile, the PPSC training facilities were modernized with the completion of the three-
storey National Police College Building and the inauguration of the fourth dormitory in the
Philippine National Police Academy Cadet Square. All these accomplishments are in line
with the PPSC Legacy Plan 2017-2022 which laid down the efforts and methods of PPSC
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in providing quality education and trainings to the uniformed personnel of the DILG, as
well as other public servants.
F. LOCAL GOVERNMENT ACADEMY (LGA)
Capacity Development Services for LGUs and DILG Local Government Personnel
The LGA continued to build upon a knowledge management framework to perform its
mandate by working with the Local Governance Regional Resource Centers and its local
and foreign partners to develop and deliver programs and services.
As the capacity development arm of the DILG, the LGA provides all local officials-elected
or appointed with trainings and seminars to help them perform their assigned tasks. One of
these was the NEO Program, an initiative to train and guide local officials from the start of
their term until its end. It comprises modules, including basic knowledge on local
governance, legislation, and leadership skills, delivered through webinars, face-to-face
meetings and mentoring wherein the following number of participants have attended:
On the other hand, 19 LGUs availed of the Scholarship Program, an intervention given by
the Academy to provide local officials and functionaries opportunities to expand their
knowledge and skills through short courses from the LGAs developmental partners.
These training programs delivered by the LGA covered different outcome areas and
interconnected different Department's initiatives. As a result, it has truly transformed the
DILG and LGU personnel into catalysts for sustainable and inclusive growth.
Strengthened DILG’s Internal Organizational Capacity
The Department has recognized the need to improve its internal governance in order to be more
effective in fulfilling its mandate and deliver its commitments to the President Among the
notable accomplishments that were carried out this year to strengthen the Department's own
internal governance capacity were categorized as follows:
A. Formulation of a new DILG Vision

The new vision provides the Department's overall direction in carrying out its plans and
initiatives. The crafting of the new vision was done through a series of consultations with
DILG officials (both from the Local Government and Interior Sector agencies) and
personnel as well as our various stakeholders and is anchored in the National Economic
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and Development Authority (NEDA)'s Ambisyon Natin 2040, which reflects the dreams
and aspirations of the Filipino People.
B. Improving Internal Systems and Processes
The 2017 Learning and Development Plan of the Department was implemented through
the following interventions: 1) Mandatory Continuing Legal Education (MCLE), 2)
Training of Trainers on Strategic Thinking, 3) 5S of Good Housekeeping in the Workplace,
4) Basic Microsoft Office Training 5) Values Orientation Workshop and Team Building 6)
Training on Complete Staff Work (CSW), 7) Performance and Results Management
Training 8) Effective Fiscal Management Training 9) Stakeholder Management Training
and 10) Career Executive Service Board (CESB) Trainings on SALDIWA and IGABAY.
This year, the Department also conducted its first "HR Roadmap”. The activity laid down
the Department's plan of action to achieve a higher level recognition under the Civil Service
Commission's (CSC) Program to Institutionalize Meritocracy and Excellence in Human
Resource Management (PRIME-HRM).
The DILG made sure to be in stride with the changing times with its current Information
and Communications Technology (ICT) initiatives. With the implementation of programs
and projects under its Information Systems Strategic Plan (ISSP) this year the Department
has improved the overall organizational capacity to deliver quality services to the public.
C. Conduct of Drug Test
Of the 293 PNP personnel who tested positive, four died prior to the conduct of
investigation, seven were placed under the jurisdiction of Directorate for Investigation and
Detective Management (DIDM), while 282 were acted by the Internal Affairs Service (IAS)
through recommendation to disciplinary authority, summary hearing and for pre-charge
investigation. As for BJMP, the total number of 19 drug-related cases which were filed
against jail officers resulted to the dismissal from service of three personnel, filing of grave
misconduct against seven personnel and tagging of two personnel as notoriously
undesirable. Two cases were dropped and closed while the remaining five are either for
filing of administrative cases, summons, or awaiting arraignment or decision. The
apprehension of these DILG personnel who betrayed public trust only shows that the DI
LG walks its talk.
D. Provision of Incentives and Awards for Exemplary Performance
The Department, as part of its commitment to provide incentives and recognition to its
officials and personnel, has conducted the Program on Awards and Incentives for Service
Excellence (PRAISE) Award. Aside from the individual awardees, the following
offices/units were given recognition for their performance during the previous year. To
culminate the different awards, a recognition rite to these outstanding offices/personnel was
held on December 14, 2017 during the 2017 DILG Christmas party celebration.
Also, the Capacity Development Awards for Catalysts of Excellence (CapDev ACE) is an
awards system designed by the LGA to recognize and reward the outstanding work
performance of DILG Regional Offices and employees. There are two categories under this
system, namely the Awards for Exemplary Performance for individuals, and the LGRRC
Champions for groups.
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E. Philippine Hosting of ASEAN 2017
DILG played a major role in the Philippine Hosting of the Association of Southeast Asian
Nations (ASEAN) Summits and Related Meetings. The year-long activities were historical
as it brought the leaders and delegates of the 10 member regional bloc, namely Brunei
Darussalarn, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, Philippines, Singapore,
Thailand and Viet Nam together with its dialogue partners such as the United States, Russia,
China and the European Union to name a few, on the occasion of the association's 50th
anniversary.
F. Information and Advocacy
Information and advocacy campaigns kicked off the Department's efforts for ASEAN 2017
through the conduct of regional orientations in Regions III, IV-A, V and NCR for DILG
regional directors and personnel, attached agencies and LGUs. The activities, conducted
with support from the Department of Foreign Affairs (DFA) and Presidential
Communications Operations Office (PCOO), engaged our hosting regions with the
provision of vital information on the ASEAN, the hosting efforts, and security procedures
to be set in place and roles of the LGUs in the conduct of the activities. Likewise, DILG
facilitated the coordination with 72 LGUs in the conduct of the 57 simultaneous ASEAN
Landmark Lighting activities on the occasion of the golden anniversary of the association.
G. 11th AMMTC and 2nd SAMMRRVE
The Department in collaboration with the Philippine Center on Transnational Crime

(PCTC), led the hosting of the 11th ASEAN Ministerial Meeting on Transnational Crime
(AMMTC) and the 2nd Special ASEAN Ministerial Meeting on Transnational Crime on
Radicalisation and Violent Extremism (SAMMRRVE) held at the Conrad Manila, Pasay
City from 19-21 September, 2017. The gathering of ASEAN Ministers holding
Transnational Crime portfolio, chaired by the AMMTC Leader, DILG Officer-in-Charge
Catalino S. Cuy and Philippine Senior Official Undersecretary Austere A. Panadero, was
convened to provide member states and delegations from China, South Korea and Japan a
platform to exchange experiences, views, and ideas on the best practices in handling the
issues on the rise of radicalisation and violent extremism.
H. Committee on Security, Peace and Order, Emergency Preparedness and Response
As member of the ASEAN National Organizing Council (NOC), the Department was
entrusted with the responsibility as the Chair of the Committee on Security, Peace and
Order, Emergency Preparedness and Response (CSPOEPR) charged to ensure the safety
and security of the ASEAN meetings and activities. Together with the PNP, BFP and 18
other agencies and partners, the DILG spearheaded the preparation and execution of
security, traffic, and emergency preparedness and response strategies for the 279 ASEAN-
related activities held during the year. Espousing the 'whole-of-government approach': the
committee held yearlong consultations and preparatory activities preceding the hosting of
APEC 2015 through simulations, bilateral dialogue, and resource building even prior to the
actual kick-off of the hosting. Through massive coordination and cooperation between the
Committee's 21 member agencies and its partners, the CSPOEPR effectively delivered its
mandate of securing a successful ASEAN hosting culminating with the successful conduct
503
of the two (2) leaders' summits held in April and November and the celebration of the 50th
anniversary of the association.
504
Department of National
Defense
DEPARTMENT OF NATIONAL DEFENSE (DND)
The Department of National Defense (DND) continues to put forward a number of priority
concerns aimed at strengthening the defense capability of the country to address existing and
emerging threats to national security while pursuing initiatives to achieve genuine peace.
To operationalize the Department’s mandate and the priorities of the President, the DND Proper
has developed, issued, reviewed, updated and/or disseminated 637 defense policies in 2017.
Meanwhile, a total of 388 key document products (KDPs) were accomplished during the 1st
semester of 2018. These are categorized as (1) KDPs under the Defense System of Management
(DSOM) which provides management framework in promoting cost-effective use of resources,
enhancing transparency and accountability, and establishing a systematic basis to develop
annual and multi-year programs and spending plans; and (2) International Defense and Security
Engagements (IDSE) which provides the guidance on engaging partners in the Asia-Pacific
region and other countries across the globe in pursuit of national security as well as regional
and global peace and stability.
Capability Upgrade of the Armed Forces
 As of 1st semester, 2018, a total of 129 projects were completed and seven (7) projects are
still on-going under the Capability, Materiel and Technology Development (CMTD)
component of Republic Act (RA) 7898 or the AFP Modernization Program (AFPMP).
Meanwhile, under RA 10349 or the Revised AFPMP, there were 16 completed and 30 on-
going projects. These are expected to improve the capability of the Armed Forces in terms
of Internal Security Operations (ISO), Territorial Defense Operations (TDO), and
Humanitarian Assistance and Disaster Response (HADR).
 For the other components of the modernization of armed forces (RA 7898), there are 166
completed projects, 19 on-going projects and two (2) terminated projects under the
Bases/Support Systems Development (BSSD). A total of 82 projects were completed and
two (2) were terminated under the Human Resource Development (HRD) component while
118 projects were completed and 24 projects are still on-going under the Doctrines
Development (DD) component. Under RA 10349, there are six (6) on-going projects under
BSSD.
 On 08 May 2018, the

President approved the
Priority Project List
under Horizon 2 of the
Revised AFPMP
consisting 76 projects
with a total amount of
PhP283,435,467,571.33. Out of the 76 projects, 13 are now under the procurement pipeline
505
DND – Annual Accomplishments for CY 2017
while the remaining 63 projects are undergoing study/ assessment by the DAS Assessment
Team for each project.
 Aside from the on-going

procurement, a total of
24 types of equipment
were donated by China,
Russia, Japan and United
States of America.
 The Government
Arsenal (GA) produced
41.855 million rounds of
small arms ammunition
in 2017 which translates
to 121.64%
supportability to AFP
Small Arms
Ammunitions (SAA)
requirements for combat
operations. For the 1st
semester, 2018, GA has
produced 16.768 million rounds of assorted small arms ammunition which already
translates to a 41.92% supportability to AFP requirements. Further, GA has repaired and
refurbished 97 units of small arms for the 1st semester, 2018.
 Upon the President’s certification on the proposed Mandatory Reserve Officers Training
Corps (ROTC) Bill as urgent and priority, the DND will begin the pilot-testing of the Basic
ROTC curriculum.
Ensuring Territorial Defense, Security and Stability
 The AFP has formulated and issued 234 military plans and policies in 2017 and 103 plans
and policies during the 1st semester of 2018. These documents translated some of the
pronouncements of the President into guidance to AFP units particularly on the conduct of
operations especially on the war against illegal drugs, terror threats and suppression of
violence.
 On territorial defense, the DND, through the AFP, focused its efforts on the conduct of
maritime domain awareness activities with the utilization of an improved inventory of
military assets to accomplish assigned tasks in addressing the challenges posed by the
complex and dynamic regional security environment. In upholding Philippine sovereignty
and territorial integrity, the AFP exercised and defended its sovereign rights over the West
Philippines Sea (WPS) with its maintained presence over the Kalayaan Island Group (KIG)
and the Bajo de Masinloc (BDM).
 The Philippines also asserted its ownership over the Philippine Rise by planting a
Philippine flag below sea level and a simultaneous flag raising aboard BRP Davao del Sur
506
during the commemoration of the 119th Independence Day on 12 June 2017 and by having
the Philippine Rise Commemoration 2018 on 15-16 May 2018.
 To ensure domain awareness, naval and air patrols were conducted to cover 25% of air
domain and 18% of maritime domain in 2017. Meanwhile, for the 1st semester 2018, 33%
of air domain was covered by AFP patrols/missions. To support this undertaking, the
Philippine Air Force maintained 153 supportable aircraft in 2017 and 154 by the 1st
semester, 2018. The Philippine Navy, meanwhile, maintained 179 mission-ready fleet
marine units and 34 mission-ready support and sustainment units in 2017. For the 1st
semester, 2018, 195 PN units were deployed and sustained for utilization/employment and
10 units were also prepared for deployment.
Combatting Insurgency and Terrorism
 To immediately address security issues particularly on terrorism in the maritime areas of

concern, a framework on Trilateral Cooperative Arrangement (TCA) or “The Joint
Declaration on Immediate Measures to Address Security Issues in the Maritime Areas of
Common Concern among the Philippines, Indonesia and Malaysia” was launched in June
2017. Together with the Defense Chiefs of Indonesia and Malaysia, the DND also formally
launched the Joint Trilateral Air Patrol last 12 October 2017 at the Royal Malaysian Air
Force, Subang Air Base in Malaysia. Recent developments in the TCA effectively
enhanced security in the Sulu Sea. Trilateral maritime and air patrols have been
operationalized for cross border security operations in the maritime areas of concern
common to the participant countries. In the same light, joint maritime command centers to
aid the operations have also been established at three (3) strategic locations. Since the start
of 2018, there were no seajacking or kidnapping incidents within Philippine waters
involving foreign nationals.
 On internal security, a total of 72 provinces were already declared as Peaceful and Ready
for Further Development (PRFD) and 93 barangays which are affected by internal armed
conflict were cleared and protected in 2017. Meanwhile, a total of 42 barangays were
cleared and protected during the 1st semester of 2018. The Philippine Army, as the major
service primarily catering to internal security concerns, maintained a total of 198 tactical
battalions and organized 82 ready reserve battalions in 2017. Meanwhile, 204 tactical
battalions and 82 ready reserve battalions were maintained as of the 1st semester of 2018.
 The government implemented all-out offensives against terror groups. The periods in-
review highlighted the AFP’s decimation of DAESH-inspired and foreign terrorists backed
Dawlah Islamiyah (DI) in Marawi City that prevented the establishment of the group’s self-
styled Wilayat. The crisis exhibited the highest peak of the long existing violent extremism
in the country.
 The successful liberation of Marawi City led to the neutralization of high-value targets
including Isnilon Hapilon, Abdullah Maute, Omar kyam Maute and Romato Maute.
This also led to the neutralization of 33 foreign terrorists in the country and collapse of
the leadership chain of the ISIS-inspired group in Mindanao.
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 Likewise, in a
series of
operations from
11 April 2017 to
15 May 2017, the
AFP successfully
neutralized the
ASG members
who attempted to
infiltrate Bohol.
 Concerning the conflict-devastated Marawi City, the AFP extended support to the over-all
recovery, reconstruction, and rehabilitation effort through active involvement in a range of
activities. The AFP’s designated a lead unit in the city which has been responsible for
clearing unexploded ordnance and improvised landmines, construction of temporary
shelters for returning Internally Displaced Persons (IDPs), and restoration of basic services.
The Task Force through the all-female Joint AFPPNP Civil Relations Company also played
an important role in the psycho-social healing of individuals who were affected in the armed
conflict.
 The AFP also continues

to conduct focused
military operations
against the Communist
Terrorist Group (CTG)
targeting members who
commit atrocities to avoid collateral damage to civilians.
 The AFP also

continues to
conduct various
operations to
include combat and
noncombat
activities against
groups such as the
Abu Sayyaf Group
(ASG),
Bangsamoro
Islamic Freedom
Fighters (BIFF) and
Dawlah Islamiyah
(DI).
 In order to protect
the community and
its people from
terrorist influence,
the AFP conducted various activities directed towards communities that terrorists exploit
508
for atrocious plans. The conduct of the Community Support Programs (CSPs) through
development activities in the countryside assisted the AFP in insulating these areas from
terrorist influence. For CY 2017, the AFP programmed a total of 266 CSPs on enemy-
affected barangays. A total of 93 programs were completed, 61 are ongoing and 113
programs have yet to be started. For the 331 programmed CSPs for unaffected barangays,
59 were already completed, 67 are on-going and 205 have yet to be started.
 As of year-end
2017, following
are the recorded
strength of threat
groups:
Martial Law Implementation
 The Secretary of National Defense as ML Administrator and the Chief of Staff, Armed
Forces of the Philippines as ML Implementer ensured the following during the ML
implementation:
 Insulate and secure unaffected areas from extremist violence
 Enforce curfews and establish control checkpoints
 Support on the dismantling of illegal drug syndicates and other lawless armed groups
 Secure the critical infrastructure and vital installations
 Arrest rebel target personalities and file appropriate charges
 Assist in monitoring local chief executives
Results of Martial Law Implementation
Insulate and secure unaffected areas from extremist violence
On insulating
and securing
areas that are
not affected by
violent
extremism, the
AFP successfully conducted a total of 3,489 engagements with key leaders, 328 Counter
Violent Extremism activities and 167,961 security patrols.
Enforce curfews and establish control checkpoints
On enforcing curfews, establishing control checkpoints and other law enforcement activities to
address criminalities, the establishment of a total of 165,761 checkpoints, resulted in 1,068
offenders apprehended and 70 firearms confiscated.
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Further, 98 other
individuals were
arrested for violating
the gun ban while 208
unauthorized or
illegally-used firearms
were confiscated.
Support on the dismantling of illegal drug syndicates and other lawless armed groups
On support to the dismantling of illegal drug syndicates, joint operations with PNP and PDEA
resulted in a total of 467 offenders neutralized, 547 assorted firearms and 24 kilos of shabu
confiscated.
Arrest rebel target personalities and file appropriate charges
For the period 23 May 2017-19 February 2018, 143 threat personalities were arrested, 65 of
which were already charged in court while 71 were released and 6 were deceased.
Law enforcement units also arrested Spanish national Abdelhakim Labidi Adib on 23 January
2018 in Basilan. Adib was carrying two hand grenades and four blasting caps at the time of his
arrest. Another foreign terrorist identified as Taha Mohamed al-Jabouri, an explosive expert
from Iran with links to terrorist groups in the Middle East, was also arrested on 21 January
2018 in Pampanga.
It can also be recalled that an Indonesian terrorist who fought with the Dawlah Islamiyah in
Marawi City identified as Mohammad Ilhaam Syahputra was also arrested in November 2017
in Brgy. Loksadatu, Marawi City.
Notably, the recent arrest of Haytham Abdulhamid Yusof on 18 February 2018 in Ermita
further illustrated the links of local terrorist groups with DAESH or ISIS. Yusof is an Egyptian
national who was a former ISIS commander and negotiator in the SyrianTurkish border.
510
Assist in monitoring local chief executives
For Regions 9-13, there was no reported unauthorized absence of local chief executives. For
ARMM, eight local chief executives were reported absent without appropriate authority. These
include the mayors of Panglima Estimo, Kalingalan Caluang, Panamao, Maimbung,
Pangataran and Omar in Sulu; mayor of Sumisip, Basilan; and, Mayor of Talitay,
Maguindanao.
Support to the Peace Process
 Believing that progress and development are dependent upon the peace and security
situation of the country, the DND, together with its bureaus, pursued its commitment to
provide a stable national security environment conducive for socio-economic growth.
 On efforts to support the peace process, the AFP through its Engineer Units was
instrumental in multi-sectoral undertakings that promoted development in conflict affected
communities, particularly in the implementation of PAMANA projects in 2017. The
projects under this program included concreting of roads in Maguindanao amounting to
Php 192 million and the OPAPP Peace and Development and Community Settlement Site
Projects for the socio-economic re-integration of former rebels in Negros Island amounting
to Php 65 million.
 With the existence of parallel efforts such as the Enhanced Comprehensive Local
Integration Program (E-CLIP), former members of the CPP/NPA/NDF were encouraged to
surrender and go back in living normal lives. The DND was designated to head the inter-
agency Task Force in charge of the reintegration efforts by providing a complete package
of assistance to former members of the CPP, NPA and NDF, to include their immediate
families, who have expressed their desire to abandon armed struggle and become
productive members of society.
 As of year-end 2017, a total of 1,162 former rebels (FRs) have expressed their desire to
return to mainstream society. Further, there were 1,495 recorded surrenderers for the 1st
semester of 2018.
 Meanwhile, the defeat of the ISIS in Marawi City, the intensified crackdown on terrorist
elements, and the pervasive implementation of Martial Law in Mindanao have convinced
our lost brothers and sisters to abandon their terrorist and extremist activities and return to
the fold of the law. Shown below are the surrenderers from local extremist groups who
went back into mainstream society.
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Disaster Risk Reduction and Management (DRRM) and Climate Change Adaptation
(CCA)
 For CY 2017, the Office of Civil Defense (OCD) was able to strengthen a total of 402
DRRM Councils of the 22 highly vulnerable provinces, 443 municipalities and 48 cities
strategically located in the Major River Basins (MRBs) through provision of Capacity
Building and Technical Assistance as well as Prepositioning of Non-Food Items (NFIs).
 The OCD has developed, issued, reviewed updated and/or disseminated a total of 29
DRRM policies and plans in 2017. Further, a total of 1,441 technical advisory assistance to
various key stakeholders and educational institutions was undertaken. This will help
increase knowledge on DRRM programs and initiatives and provide participants full
understanding on the institutional mechanism of DRRM initiatives. For the 1st semester of
2018, however, the OCD was able to capacitate 727 volunteers and maintain 18 emergency
operations center.
 On the streamlining of the evaluation process in relation to NDRRM Fund requests, the
NDDRM Council has already approved the revised Guidelines on the Administration of
the National Disaster Risk Reduction and Management (NDRRM) Fund on 14 March 2017.
The purpose of the guidelines is to update and rationalize the system for the management
of the NDRRM Fund to enhance responsiveness, transparency and accountability.
 The OCD, through the NDRRMC, has conducted a harmonized contingency planning for
a 7.2 magnitude earthquake, and continues to organize quarterly national simultaneous
earthquake drills as preparedness measure in the event of a strong earthquake that will affect
Metro Manila, Central Luzon, and Calabarzon.
 The NDRRMC also developed a Community Responders Course, a program that would
capacitate probable first responders with immediate and initial capabilities needed during
emergencies and disasters in their locality. Likewise, a new operation center was
established and is now interconnected with the Regional DRRM operations centers thus
leading to faster and efficient decision making and timely information dissemination.
 For CY 2017, OCD’s Quick Response Fund allocation was placed under the Special
Purpose Fund (SPF), wherein requests for utilization were made to the DBM. Of the total
allocation of Php 500,000,000, Php 403,605,142.59 was obligated. Meanwhile, for the 1st
semester of 2018, a total of PhP 201.169 Million out of the allocated PhP 250 Million for
Maintenance and Other Operating Expenses (MOOE) was obligated.
Developing National Security Leaders
 The National Defense College of the Philippines (NDCP) administers the conduct of the
Master in National Security Administration (MNSA). For the past years, there is a
significant improvement in the success rate of students taking the MNSA program. From
2010 to 2017, the success rate of MNSA students increased from 90% in 2010 to 100% in
2017. From only 26 graduates in 2010, the number increased to 65 graduates of Regular
Class (RC) 52 in 2017. The MNSA program helps in developing the skills and
competencies of potential national defense leaders. A total of 65 scholars were admitted to
RC 53, which is an on-going program expected to end by the 3rd quarter of 2018.
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Looking after the Welfare of Veterans and AFP Retirees
 The Philippine Veterans Affairs Office (PVAO) made an average of 219,880 pension and
other benefit payments in 2017 to a total of 186,884 pensioners and beneficiaries. For the
1st semester of 2018, PVAO was able to accomplish 201,370 pension payments, 4,951
Total Administrative Disability (TAD) Arrears payment, 4,151 hospitalization benefit
payments, 804 educational benefit payments, and 2,200 burial assistance payments.
 A total of PhP 65.6 Million was transferred to the Veterans Memorial Medical Center
(VMMC) as of 30 June 2018 for hospitalization benefits. As of the 1st semester of 2018,
there are already 316 notarized Memoranda of Agreement (MOAs) with government and
private hospitals for the Veterans Hospitalization Program.
 VMMC accomplished a total of 10,410 and 191,196 in-patients and out-patients treated in
2017, respectively. Meanwhile, 5,218 and 97,146 in-patients and outpatients were treated
during the 1st semester of 2018. These accomplishments provide a picture on the health
services provided for veterans and their dependents in recognition of their valuable service
to the country.
Strengthening International Cooperation
 To broaden our international defense and security engagements and in relation to the
directive of the president to establish an independent foreign policy, the DND collaborates
with more countries in the Asia Pacific region, while maintaining our long-standing relation
with traditional allies.
 For the period covered, following are the signed defense agreements with seven (7) foreign
partners, namely, Cambodia, China, Czech Republic, Russia, UK, New Zealand and India..
 Notably, a Declaration of Intent (DOI) in the Field of Research, Development, Production

and Procurement of Defense Related Equipment and Cooperation on Defense Industry
between the DND-RP and the Ministry of Defense of Turkey was signed on 10 May 2017
at the sidelines of the 13th International Defense Industry (IDEF) held from 09 to 12 May
2017 in Istanbul. Moreover, the Philippines and Thailand signed a Terms of Reference
(TOR) of the Joint Committee on Military Cooperation (JCMC) last 17 August 2017 in
Manila.
 Meanwhile, the DND is currently discussing agreements with countries such as Canada,
Croatia, France, Germany, Israel, Italy, Jordan, Myanmar, Pakistan, Portugal, Qatar,
Russia, Spain, Sri Lanka, Turkey and United States of America. Further, the DND received
proposals from Bangladesh, Belarus, Brazil, Fiji, Iran, Kyrgyzstan, Singapore, Slovenia,
Tajikistan, Timor-Leste, United Arab Emirates and Ukraine which are all being assessed
by this Department.
 In connection with our country’s ASEAN chairmanship this year, we recently hosted the
successful ASEAN defense ministers’ meeting last October 2017.
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 The NDCP also hosted two international conferences, namely, the 1st ASEAN regional
forum heads of defense universities, colleges, institutions meeting; and, the 10th Track II
network of ASEAN defense and security institutions meeting.
 The OCD also organized the ASEAN Joint Task Group on Emergency Preparednesss and
Response under the Committee on Security, Peace and Order, and Emergency Preparedness
to ensure the successful hosting of the ASEAN meetings in the Philippines.
Providing the Needs of Soldiers
In compliance with the instructions of the President, the DND through the AFP facilitated the
Quick Provision of Assistance to the Wounded-in-Action (WIA) and Killed-in-Action (KIA)
military personnel. Further, benefits and other remuneration for personnel who were KIA and
WIA were given such as cash assistance from Alay sa Kawal Foundation and house and lot
remuneration for KIA beneficiaries.
Institutionalization of Good Governance
In response to the President’s directive to streamline government processes, the DND and its
bureaus took the necessary efforts to improve its systems and processes. As prescribed by the
Anti-Red Tape Act, the DND bureaus maintains and updates their respective Citizen’s Charter
to promote transparency with regard to the manner of transacting with the public through the
simplification of frontline service procedures, formulation of service standards for every
transaction, and making these known to the customer.
 All DND Bureaus continued to provide online services to include provision of information
thru official websites and facebook pages (e.g. latest activities, downloadable references
and forms, feedback from stakeholders and compliance to transparency seal).
 The Department pursued the development and sustainment of various DND Quality
Management Systems toward ISO 9001:2008 Certification in order to promote and enhance
public sector performance.
 To improve the Department’s ability to perform its mandate more effectively and
efficiently, the DND and its bureaus pursued the crafting of Transformation plans. This
initiative enables the Department to cope with the evolving defense and security
environment, and to find ways to respond to defense and security threats.
The DND has accomplished tangible outputs in order to fulfill its mission and comply with the
pronouncements of the President. Aside from sustaining and institutionalizing reform measures
and upgrading its capabilities, the DND continues to perform its mandate and its commitment
to the Filipino people. Rest assured that for the next years, the Department of National Defense
will remain as an agent of change and will continue to support the President’s national security
thrust of attaining permanent and lasting peace for the country.
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Department of Social Welfare
and Development
DEPARTMENT OF SOCIAL WELFARE AND DEVELOPMENT (DSWD)
In 2017, the Department of Social Welfare and Development (DSWD) once more advanced
as the social welfare arm of the national government by expanding and improving its
operations, particularly through programs, projects and services for the poor, the vulnerable
and the disadvantaged aimed at having a large-scale impact on the quality of life.
Remarkably, the DSWD reemerged as an agency extending “maagap at mapagkalingang
serbisyo,” “serbisyong walang puwang sa katiwalian” and “patas na pagtrato sa komunidad”
anchored – for the most part – in the new vision and mission statements1.
Along the lines of such development,

the DSWD adopts five (5) updated
organizational outcomes starting 2017,
consistent with the new Program
Expenditure Classification (PrExC)
introduced by the Department of
Budget and Management as the next
phase of the performance-informed
budget reform.
Evolving from the Organizational

Performance Indicator Framework, the
PrExC is the logical continuation of
Performance-Informed Budgeting that:
reflects in the budget the link between
strategies, budgets and results; and,
facilitates the monitoring and
evaluation of programs with performance indicators for each program.
So as to kick off the alignment of

existing monitoring and reporting
system with the aforesaid way
forward, the 2017 Annual Technical
Report of the DSWD features
accomplishments under each of its
updated organizational outcomes,
including support to operations and
general administration and support
services.
The annual accomplishments indicated

in this report mark the beginning of a
reinvigorated DSWD, with fresh
milestones that showcase its continued leadership in the social welfare and development
(SWD) sector.
1 Enshrined in DSWD Administrative Order No. 02 s. 2017, “DSWD Vision, Mission Statements and Organizational Outcomes”
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DSWD – Annual Accomplishments for CY 2017
Improving the Wellbeing of Families
As SWD promotive programs, the DSWD strategically implements big-ticket programs that
invest in human capital through conditional cash transfer, community-driven development
and sustainable livelihood. These include the Pantawid Pamilyang Pilipino Program,
Sustainable Livelihood Program and Kalahi CIDSS – National Community-Driven
Development Program.
Throughout 2017, the Pantawid

Pamilyang Pilipino Program
(Pantawid Pamilya) covered
41,605 barangays at 144 cities
and 1,483 municipalities in 80
provinces nationwide, serving a
total of 4,394,813 active
households that received cash
grants in the total amount of
PhP75.58 Billion.
For Kalahi CIDSS – National

Community-Driven Development
Program (KC-NCDDP) in 2017,
a total of 2,248,428 households
benefitted from 5,214 completed
sub-projects in 18,760 barangays
located at 799 municipalities,
utilizing PhP9.42 Billion under
Current Appropriations and
PhP3.39 Billion under
Continuing Appropriations.
Cumulatively, since its program
launch in 2014, 4,628,217
households were served from
20,184 completed sub-projects.
Moreover, the Sustainable Livelihood Program (SLP) served a total of 196,418 Pantawid
Pamilya and Non-Pantawid Pamilya households under the Microenterprise Development and
Employment Facilitation tracks, in the total obligated amount of PhP6.13 Billion from 2017
Current and 2016 Continuing Appropriations.
On the Convergence Strategy to combine and increase the impact of social protection
programs in the lives of beneficiaries, 1,263 cities/municipalities are already covered by the
three (3) aforementioned programs while 325 cities/municipalities have two (2) programs and
42 cities/municipalities with one (1) program coverage out of the target of 1,630 localities in
2017.
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Promoting and Protecting the Rights and Welfare of the Poor, Vulnerable and
Disadvantaged Sectors
Through its SWD protective programs and

services, the DSWD caters to children in need of
special protection, women in especially difficult
circumstances, out-of-school and other
disadvantaged youth, persons with disability,
senior citizens and displaced persons, as well as
other individuals and families in crisis situation.
Such element of the DSWD’s mandate

commences with the development of social
technologies – or the SWD models of intervention
– to address specific privations of the poor,
vulnerable and disadvantaged sectors of society.
In 2017, three (3) concept papers and three (3)
project designs were developed, while 10 models
of intervention were pilot-tested. Activities were
also conducted to promote completed social
technologies, in order to bring into fruition their
adoption or replication by LGUs, NGOs and other
intermediaries.
Under the Supplementary Feeding Program, 2,001,142 children of the 6th Cycle and
1,528,839 children of the 7th Cycle – in child development centers and supervised
neighborhood play – were provided with hot meals. In support of that, the Bangsamoro
Umpungan sa Nutrisyon Project and other feeding programs i.e., Pilot Twice-A-Day Feeding,
Milk Supplementation Program, Community-Based Supplementary Feeding and Partnership
against Hunger and Poverty have been initiated to deal with high incidence of malnutrition
among children.
On Social Pension for Indigent

Senior Citizens, there were 2,652,270
beneficiaries for the 1st Quarter,
2,649,912 for the 2nd Quarter,
2,683,037 for the 3rd Quarter and
2,540,221 for the 4th Quarter of 2017
who received their monthly stipend
of PhP500.00. For the 2016
coverage of the Centenarian Act,
2,739 centenarians received the cash
gift of PhP100,000.00 each as of
December 2017, which utilized
PhP273.9 Million. For the 2017
coverage, 940 centenarians already
received said gift utilizing PhP94
Million.
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The DSWD also served 18,814 clients in its residential care facilities and centers/non-
residential care facilities that cater to vulnerable and disadvantaged children, youth, women
in especially difficult circumstances, senior citizens, persons with disability and other
adults/families in need, costing PhP1.37 Billion.
For individuals and families in crisis or difficult situation, the DSWD offered a range of
interventions to 754,043 clients under the Assistance to Individuals in Crisis Situation,
disbursing a total amount of PhP2.80 Billion as of December 2017. Likewise, 45,388
indigent patients in selected hospitals received medicine assistance totaling to PhP438.48
Million through the Libreng Gamot Para sa Masa. Under the Assistance to Communities in
Need, 34 projects (consisting of construction or repair of child development and senior
citizen centers) were completed in 11 regions.
In line with the prevention of trafficking and exploitation of Filipino children, travel
clearance was granted for 41,914 minors traveling abroad as of December 2017.
Furthermore, the DSWD issued Certificate Declaring a Child Legally Available for Adoption
for 753 children, while a total of 437 children were placed under foster care with licensed
foster parents.
By the same token, the DSWD continued

providing for the pressing needs of
vulnerable sectors through the Recovery
and Reintegration Program for Trafficked
Persons with 1,880 clients, the PAMANA
Program for areas affected by conflict, the
International Social Welfare Services for
Filipino Nationals for 13,560 undocumented
and distressed individuals overseas, the
Youth Welfare and Development Program
for out-of-school and disadvantaged youth,
and the Persons with Disability Program.
Ensuring Immediate Relief and Early Recovery of Disaster Victims/Survivors
One of the immense challenges of the DSWD is to increase the resiliency of poor families
and communities in the new normal where weather patterns have drastically changed and
natural disasters are bigger, stronger and harder. Natural disasters, including human-induced
tragedies, led the DSWD to the forefront of government response, making its programs and
services vital to providing immediate relief and early recovery interventions to victims.
Under the government’s Disaster Risk Reduction and Management Program, the DSWD
assumes dual roles in every occurrence of disaster such as: interagency coordination during
disaster response, through the Response Pillar of the National Disaster Risk Reduction and
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Management Council; and, provision of social welfare services, including relief assistance,
evacuation camp coordination and management, and social protection of internally displaced
persons.
For disaster response management, the DSWD provided assistance to victims of disasters in
the form of food and non-food items. In 2017, the DSWD assisted victims of an earthquake
in Surigao Del Norte and flooding in Agusan Del Norte/Agusan Del Sur (amounting to
PhP16.16 Million), tropical storm “Urduja” (amounting to PhP146.69 Million), tropical storm
“Vinta” (amounting to PhP29.35 Million), typhoon “Niña” (amounting to PhP184.44
Million), armed conflict in Marawi City (amounting to PhP861.56 Million), armed conflict in
Ifugao Province (amounting to PhP950,000.00), flooding in Cagayan de Oro City (amounting
to PhP4.87 Million) and fire incidents in Metro Manila (amounting to PhP8.07 Million).
In addition, the DSWD implemented the

Emergency Shelter Assistance/Emergency
Shelter Cash Assistance Program for 337,595
households affected by earthquakes, flooding
and typhoons “Lawin” and “Niña” in CAR,
Regions I, II, IV-A, IV-B, V, VIII, Caraga and
ARMM, amounting to PhP3.33 Billion. The
Cash-for-Work provided temporary
employment to 255,066 households in the
repair of shelters and community facilities
damaged by earthquakes, flooding, armed
conflict and typhoons “Lawin” and “Niña” in
CAR, Regions I, II, IV-A, IV-B, VIII, XI,
Caraga and ARMM, amounting to PhP335.20
Million.
The DSWD also managed the Presidential Financial Assistance for Typhoon “Yolanda”-
affected Households, serving 73,020 households in the total amount of PhP365.10 Million.
In aid of disaster relief operations, the DSWD produced 996,223 family food packs (FFPs)
costing PhP358.64 Million; from said number, 983,234 FFPs were prepositioned with the
DSWD Field Offices – particularly at disaster response centers and warehouses – for the
victims of disasters in 2017 like Typhoon “Niña,” Tropical Storm “Urduja,” Tropical Storm
“Vinta,” Surigao Del Norte earthquake, Batangas earthquake and Marawi armed conflict.
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Ensuring Continuing Compliance of Social Welfare and Development Agencies to

Standards in the Delivery of Social Welfare Services
Anchored in its steering role, as a result of redirected functions and operations2, the DSWD
administers the registration, licensing and accreditation of individuals and social welfare and
development agencies (SWDAs) to put into effect the quality of social welfare services given
to the poor, vulnerable and disadvantaged sectors.
Thus, to ensure that SWDAs observe

standards for quality and competencies
in the delivery of social welfare
services to their clients, the DSWD
assessed 80 auxiliary SWDAs for
registration and/or licensing to operate
and granted the registration and/or
license to 55 auxiliary SWDAs in
2017. Moreover, 554 social welfare
agencies (SWAs) were assessed for
registration and/or licensing to operate
while 440 SWAs were registered
and/or issued license to operate.
On the accreditation of SWD programs

and services of SWAs and individual
service providers, the DSWD
accredited 11 of its centers, 18 of local government units, 60 senior citizens centers, 5,411
day care centers and 161 SWDAs/non-government organizations, apart from 256 pre-
marriage counselors and 98 social workers managing court cases in 2017. Relatedly, 2,267
civil society organizations (CSOs) were accredited as beneficiary partners and 20 CSOs as
implementing partners.
Underlying to its regulatory functions, the DSWD crafted the following: Guidelines on
Handling of Complaints against SWDAs; Guidelines in the Organization, Mobilization and
Strengthening of Area-Based Standards Network; Amendment to the Guidelines on
Registration and Licensing of SWDAs and Accreditation of SWD Programs and Services;
Amendment to the Standards for Residential Care Services; Amendment to the Guidelines on
Accreditation of Civil Society Organizations as Beneficiary Partners of DSWD Projects
and/or Programs; Guidelines on Monitoring, Tools and Protocols; and, Amendment to the
Guidelines on Accreditation of Pre-Marriage Counselors.
The DSWD also assisted in the enhancement of the SWDAs Bill and Public Solicitation Bill.
In aid of the enhancement of SWD standards, the following were conducted: Roundtable
Discussion on Monitoring SWDAs; and, Orientation on the Accreditation Guidelines for
DSWD Beneficiary CSOs.
2 According to Executive Order No. 15 s. 1998 and Executive Order No. 221 s. 2003
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Improving the Delivery of Social Welfare and Development Programs by Local

Government Units, through Local Social Welfare and Development Offices
In view of the devolution of basic social services to local government units (LGUs)3 resulting
in a challenging paradigm shift, the DSWD has been mandated to provide assistance to LGUs
for the implementation of SWD programs and services that alleviate poverty and empower
disadvantaged individuals, families and communities. Purposely, the DSWD provides
technical assistance, including capability building, and resource augmentation to LGUs
through local social welfare and development offices (LSWDOs).
In 2017, to build further on the cornerstone for its role of providing technical assistance, the
DSWD conducted the Capacity Needs Assessment of LSWDOs for the remaining 350
municipalities at 27 provinces, which were not assessed in 2013 and 2014. The assessment
was aimed at developing a national landscape of competencies for Local Social Welfare and
Development Officers and ensuring that learning needs – along the development areas of
LSWDOs – are captured.
As a form of technical assistance, the following capability building activities were conducted
to capacitate LSWDOs/Local Social Welfare and Development Officers: Learning and
Development Intervention (LDI) on Logistics Management; LDI on Psychosocial Support in
Emergency Setting; Competency-based Leadership Development Workshop; LDI on
Leadership and Management; Capability Building on Documentation of Good Practices in
SWD Program and Service Implementation; and, Annual National Social Welfare and
Development Learning-Network Conference. In support of that, the DSWD applied for and
was granted accreditation by the Professional Regulation Commission as local service
provider of LDI programs for LGUs.
On knowledge management, the DSWD developed the following products: Knowledge

Management Toolkit; Case Study for Logistics Management Trainings; and, three (3) audio
visual presentations on knowledge management advocacy. Relevantly, four (4) knowledge
products of LSWDOs – focusing on the implementation of community-based drug
rehabilitation programs and local SWD programs – were assessed. As platforms for
knowledge management, the DSWD continued managing and improving its Knowledge
Exchange Center, including the Knowledge Management Portal.
In sum for 2017, a total of 1,065 LGUs/LSWDOs (from the target of 619) were provided with
resource augmentation in the form of funding i.e., fund transfers for disaster response and
early recovery initiatives, construction or improvement of community facilities (like day care
centers and senior citizen centers) and supplies/materials for disaster response initiatives i.e.,
food and non-food items, including family food packs, hygiene kits, sleeping kits or family
kits.
3 Pursuant to Republic Act No. 7160 or the Local Government Code of 1991
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Department of Health
DEPARTMENT OF HEALTH (DOH)
ACCOMPLISHMENTS IN 2017
I. PROGRAMS FOR ALL LIFE STAGES
KEY INDICATORS
The key indicators that provide information on the general performance of health programs
are as follows:
Child immunization is an essential public

health program given priority by the national
government. In the last few decades, the
percentage of Fully Immunized Children
(FIC) has remained within the range of 60-
70%. The performance of this indicator is
shown in Figure 1.
The DOH has been maximizing its current

resources despite the challenges in
delivering reproductive health services.
Regardless of the recent challenges, the
percentage of contraceptive prevalence rate
has steadily increased since 1993. This is
shown in Figure 2.
The government has invested much for maternal

care in the past administration, such as
infrastructure and human resources for health.
The result of these investments can be seen in
the steady increase of maternal care services
coverage for pregnant women as shown in
Figure 3.
CHILDREN
National School Deworming Month, OPLAN: Goodbye Bulate
The Goodbye Bulate campaign is a joint initiative of the Department of Health, Department of
Education, Department of Interior and Local Government and Local Government Units since
2015 to eradicate intestinal parasitism in children. The campaign is held every January and
July and provides free deworming medicine through schools and Rural Health Units. For the
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DOH – Annual Accomplishments for CY 2017
year 2017, more than 30 Million children between 1-18 years old were dewormed. The
program also includes awareness and advocacy and training for healthcare workers.
“Come Back to Bakuna”
The Department of Health, in partnership with the World Health Organization, launched a
communication campaign during the National Immunization week celebration last April 2017.
The Come Back to Bakuna campaign aims to improve the childhood vaccination coverage of
the Philippines. It utilized an edutainment (educational entertainment) approach that was rolled
out in national TV, radio, social media, and communities. It used music videos with catchy
jingles and engaging dance moves to highlight easy-to-recall information on vaccination
schedule, preventable diseases, and safety.
Task Force for School Based Dengue Immunization
A Task Force headed by the Office of the Chief of Staff was formed to manage concerns related
to the dengue immunization program, and ensure the well-being of dengue vaccine recipients.
Four Committees comprise the Task Force: a Steering Committee, Technical Committee, Risk
Communication Committee, and Field Operations and Surveillance Committee. The DOH
conducted monitoring visits, enhanced dengue surveillance and monitoring, developed
mechanisms to address medical needs of vaccinated children, and conducted information
dissemination campaigns.
The DOH also established a hotline and a Public Assistance Desk so that the vaccinated
children, their families and the general public can have easy access to information and services
on the dengue vaccine initiative.
Medical Assistance Program: Kawasaki Disease
The Kawasaki Diseases also known as Kawasaki Syndrome is an illness with no definite cause
that primarily affects children younger than 5 years of age. Through the passage of the Rare
Disease Act of the Philippines (RA 10747), the Department of Health is embarking on the
provision of services to patients with rare diseases. That is, providing patients and their families
better access to adequeate healthcare service to treat their condition. This includes the
Kawasaki syndrome which is supported through the Medical Assistance for Indigent Patients
Program. As of December 2017, there were 59 patients served with the Medical Assistance for
Kawasaki Disease.
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Nutritional Feeding Program for Pre-school Children
Department of Health (DOH) – MIMAROPA under its Oplan Kain Sigla Program started
another round of Eat to Nourish Approach Feeding Package targeting 420 pre-school children
aged 6 – 71 months in the region. The program aimed to improve the nutritional status from
underweight or severely underweight to normal in a span of 90 days. The program provided a
full meal amounting to PHP 80 per day, including morning snacks, to preschoolers with weight
and height that are lower for their age.
PREGNANT WOMEN
Maternal and Neonatal Tetanus Elimination (MNTE)
On November 29, 2017 the Philippines through the Department of Health celebrated the
achievement of eliminating maternal and neonatal tetanus. Such efforts were made possible
through immunization, antenatal care and safe delivery practices, and enhanced neonatal
tetanus surveillance. The country now has less than one case of neonatal tetanus per 1,000 live
births in all its cities and provinces. Moreover, it now joins 43 other countries which have
achieved this global public health goal.
Healthy Women Healthy Economies and Buntis Summit 2017
A regional launching of Healthy Women Healthy Economies (HWHE) was conducted last
March 8, 2017 at the conference room of the Department of Health Region III Office. This
initiative seeks to enhance women’s economic participation by improving women’s health.
The launching for this initiative expanded the involvement of other government and private
workplaces in Central Luzon in its implementation.
The Buntis Summit 2017 which was attended by more than 100 pregnant women, aimed to
reduce maternal and child mortality through increased awareness on the importance of the 3-
Delays: 1) seeking appropriate medical care, 2) reaching an appropriate medical facility, and
3) receiving adequate care when a facility is reached. This year, it was held in 12 different
Municipalities/Cities in the Cagayan Valley Region from March – October 2017 with the
theme: “Kalusugan Mo Inay, Ingatan Mo: Kinabukasan Ninyo ni Baby, Nakasalalay Sa’yo”.
ADULTS
Among adults, the top

leading cause of
morbidity and
mortality (based on
the Philippine Health
Statistics, 2015) are
lifestyle-related
diseases such as:
diabetes,
hypertension, and heart diseases to name a few. The Department of Health addressed these
illnesses through the Tamang Serbisyo sa Kalusugan ng Pamilya (TSeKaP) program and
provision of commodities. In line with this, commodities to address the leading morbidity and
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mortality in the country which are Diabetes and Hypertension, are assisted through the
Medicines Access Programs.
ELDERLY
Elderly Filipino Week Celebration
The Elderly Filipino Week Celebration is observed every first week of October. This is in
accordance with Proclamation No. 470 signed by former President Fidel V. Ramos on
September 26, 1994. On October 1, 2017, over 200 senior citizens from Baguio City and La
Trinidad, Benguet participated in this event. The theme for this celebration is: Pagkilala sa
Kakayahan, Ambag, Paglahok ng mga Nakatatanda sa Lipunan . It aimed to encourage the
elderly to have an active lifestyle, information of their rights and privileges, and their roles in
cooperation with government agencies. Services such as: Medical Consultation, Nutritional
Assessment and Counselling, Health and Wellness, and Membership and Provision of ID were
provided by different government institutions.
SPECIAL POPULATION GROUPS
39th National Disability Prevention and Rehabilitation Week
The City Government of Tacloban through the City Social Welfare and Development Office,
spearheaded this year’s National Disability Prevention and Rehabilitation Week Celebration
from July 17 – 23, 2017. The event aimed to stimulate public awareness on the issues and
problems of disability. The celebration featured a motorcade and a consultation dialogue and
orientation on programs and services for persons with disabilities. It was well participated by
the technical working group members of the Regional Committee for Disability Affairs
(RCDA), representatives from both government and non-government agencies, Persons with
Disabilities Office (PDAO), and several persons with disabilities (PWDs) from Region VIII,
primarily Tacloban City.
II. COMMUNICABLE DISEASES
KEY INDICATORS
Elimination of communicable diseases is among the major programs of the DOH. The number
of endemic areas that have been declared disease free is an indicator for the progress of
elimination of these diseases.
Additional Rabies-free areas: Four

municipalities in Masbate (Monreal,
San Fernando, San Jacinto, and
Batuan) Three municipalities in
Romblon (Concepcion, Corcuera, and
Banton) One municipality in Bohol
(Pres. Carlos P. Garcia)
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Additional Filariasis-free
areas: Sulu Quezon Province
Camarines Norte
Additional Malaria free areas: Nueva

Vizcaya Mountain Province South
Cotabato Misamis Oriental Bataan La
Union Ilocos Norte Pangasinan
Compostella Valley Surigao del Sur.
RABIES
By 2020, the Philippines aimed to be a rabies-free country. The Department of Health, through
the Rabies Prevention and Control Program, in cooperation with other government agencies
and health partners, adopted a strategy for reducing the risk of rabies exposure and providing
appropriate management of animal bites. As of 2017 partial data, a total of 775,951 persons
were given post-exposure rabies vaccines.
ALL-OUT W.A.R. (Walk Against RABIES)
The Department of Health Region I, in partnership with the Local Government of Mabini,
educated pet owners, and residents organized a campaign on rabies prevention and responsible
pet ownership. The campaign was called All-out WAR (Walk Against Rabies) with the theme
Rabies Iwasan! Kapag Nakagat Magpabakuna . Over 200 barangay health workers, barangay
and municipal government officials, as well as pet owners from the 16 barangays of Mabini
town participated in the event. The campaign aimed to strengthen strategies and extend
networks with barangay health partners towards achieving a rabies-free community.
FILARIASIS
The Filariasis Control Program implements a mass treatment strategy integrated with other
parasitic control programs (i.e. Soil-transmitted Helminthiasis and Schistosomiasis). In 2017,
the programs were able to provide 5,635,831 persons with anti-filariasis medicines and
1,536,890 persons with schistosomiasis medicines. These were delivered through mass drug
administration.
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HIV/AIDS
The number of HIV/AIDS cases in the country has been increasing. Most of these cases are
asymptomatic at the time of reporting and are males (96%) with a median age of 27 years old
(range: 2 – 70 years old). The DOH has been intensifying its strategies to combat the increasing
number of new cases diagnosed in the country. These strategies are in the form of providing
information on prevention
and early detection of
HIV/AIDS through proactive
partnership and advocacies;
prevention interventions
including provision of
condoms and lubricants; and
early treatment to prevent
progression of AIDS and
decrease viral load.
Annual International AIDS Candlelight Memorial
The Department of Health (DOH) Region VII, stakeholders, and partners, commemorated the
Annual International AIDS Candlelight Memorial last May 17, 2017. This was held at the Cebu
Provincial Capitol Social Hall with the theme: Ending AIDS Together. It was attended by the
Secretary of Health along with official representatives from DOH Central Office, Province and
Cities of Cebu and Mandaue, and other local government units. The objectives of the event
were to commemorate the people who lost their battle with AIDs; raise awareness in the fight
towards ending the stigma and discrimination related to HIV and AIDS; and recognition to our
health partners’ continuous support in ending the AIDS epidemic. The candlelight ceremony
was simultaneously conducted in three different provinces (i.e. province of Bohol, Negros
Oriental, and Siquijor). Free voluntary HIV screening and counselling were offered during the
activity.
TUBERCULOSIS
Communicable diseases remain to be a burden in the Philippines. For the case of Tuberculosis
(TB), based on the 2016 World TB report of the World Health Organization (WHO), the
country was included in the 30 high TB burden countries. But, despite this, progress has still
been made in terms of decreasing these incidences. Strategies to detect and control TB have
shown to be effective, as accomplishment of Case Detection Rate and Treatment Success Rate
are improving. These indicators are usually near or above the target set (See Figure 8). Such
strategies are geared towards the elimination of TB.
TB incidences in all forms has also

remained high for the past five years based
on the Global TB reports (see Figure 9).
Broader social and economic influences
on the TB epidemic are said to be the
plausible reasons for this phenomenon.
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Philippine Antibiotic Awareness Week 2017
The Philippines celebrated the Philippine Antibiotic Awareness Week on November 2017 with
the theme, Seek advice from a qualified healthcare professional before taking antibiotics . The
DOH National Capital Regional Office hosted the kickoff ceremony in Manila, while
community awareness activities were led by several DOH Regional Offices. The DOH also
partnered with the National Telecommunication Commission for a short message service blast
to promote the rational use of antimicrobials, prevention of infection, and the importance of
seeking medical consultation.
World Tuberculosis Day
The Department of Health Region VIII with the members of the Regional Coordinating
Committee, National Government Agencies Regional Offices, Developmental Partners, and
people from the community partnered to celebrate World Tuberculosis (TB) Day last March
25, 2017 at Mc Arthur Park, Palo Leyte. This is the second year of the two-year Unite to End
TB campaign with the theme: Unite to End TB: Leave no one behind. This event focused on
overcoming stigma, discrimination, marginalization, and barriers to access care.
LIFESTYLE RELATED DISEASES
Philippine and ASEAN Conference on Non-Communicable Disease (NCD)
Last October 25-27, 2017, the Philippine’s hosted the ASEAN NCD forum entitled: Working
Together Towards an Enabling Environment for a Healthy Lifestyle in the ASEAN Region, as
part of the ASEAN’s 50th founding anniversary celebration. The event provided a platform for
representatives from the ASEAN member states to discuss and share updates, insights, and
experiences on NCD prevention and control.
The plenary and parallel discussions were organized into the following areas: (1) fiscal
measures; (2) regulatory measures; (3) information, advocacy, and action; and (4) service
delivery innovations, to highlight gaps and potential interventions for managing NCDs and
their risk factors. The discussions highlighted the importance of developing critical public
policy measures, best buy interventions, and an overall system that would encourage people to
adopt a healthy lifestyle.
The Philippine NCD forum was held as a pre-conference event last October 24, 2017 with the
theme, Taking Action to Beat NCDs through Health Regulation. The forum gathered the
country’s different stakeholders to share and gather local insights on how to strengthen policy
and regulatory measures, information and advocacy campaigns, and service delivery, for the
prevention and control of NCDs and their risk factors.
World No Smoking Awareness Month
The Department of Health Region VIII spearheaded activities in celebration of the World No
Smoking Awareness Month in June, including a fun run and a campaign in schools.
The Tobacco Run was participated by the Philippine National Police, students, private
individuals, and other fun run enthusiast. The proceeds of the event were allocated for
emergency response and communication materials.
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A No Smoking Inter-School Campaign was also done last June 15, 2017 in coordination with
Eastern Visayas State University, Leyte National High School, and St. Scholastica’s College
Tacloban. A symposium in observance of the World No Smoking Awareness Month and
Advocacy was participated by 150 University College and High-school students.
DOH Quitline
The DOH, in partnership with the

World Health Organization,
launched a support service for
Filipinos who want to quit tobacco
use in June 9, 2017. The general
public can access Quitline services
such as motivation advice, guidance,
and counseling through phone,
mobile, and messaging.
Heart Month Celebration
The Department of Health through the Lifestyle Related Diseases Division of the Disease
Prevention and Control Bureau (DPCB) in partnership with the Department of Agriculture,
conducted a Food Fair with the theme: Gulay at Prutas Araw-arawin. Matamis, mamantika,
maalat hinay-hinayin . This was conducted last February 13 – 17, 2017 at the DPCB-Bldg. 14.
The objective of this activity was to promote the consumption of healthy diet among employees
to reduce the risk for noncommunicable diseases. Event highlights of this activity were the
ribbon cutting ceremony, picture taking at the photo wall, diet counselling and diabetes
screening services, and cooking demonstration of healthy heart recipes.
“Kapihan sa Baguio”
Kapihan sa Baguio is a monthly forum that tackles current issues on health to educate the
general public. On October 10, 2017, in celebration of the Bone and Joint Awareness Week,
Kapihan Sa Baguio tackled the number one skeletal problem in the Philippines – Osteoporosis.
This segment called for the increase in dietary intake of calcium to the public, especially the
youth. The public was advised during this segment to invest in calcium by drinking milk or
eating food rich in calcium, among other health practices.
On November 14, 2017 the forum discussed diabetes and its types, and the impact it has in the
country for the next 20 years. This is most particular to pregnant women, people with a family
history of diabetes, and stress in the work place and homes. The forum provided suggestions
on preventing further problems in the future.
Annual Health Check-Up and Surgical Caravan
In line with the DOH’s guarantee of quality health services for all Filipinos, the Annual Health
Check-up Program continues to provide primary care services for Filipinos within their
communities. In 2017, a total of 1,197,282 patients were served. Poor and marginalized
individuals, particularly those identified through the National Household Targeting System
(NHTS), were provided free services in public health facilities through the PhilHealth Primary
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Care Benefit Package. Services include physical assessment, laboratory services, oral/dental
services, eye care services, medical consultations, dispensing of prescribed medicines, and
health education. Patients who needed more specialized care were also referred to the
appropriate facilities, including a Surgical Caravan for those who needed operative services.
The Surgical Caravan provided free surgical services, including pre-operative laboratory tests
and post-operative medicines, to a total of 13,093 patients. This was made possible through
the efforts of DOH Regional Offices, surgical teams from 63 DOH Hospitals, and select LGU
hospitals. Surgical procedures done included 8,018 minor surgeries, such as circumcision and
breast mass excision, and 5,075 major surgeries such as thyroidectomy, cleft palate repair, and
cholecystectomy. The medical expenses were covered through PhilHealth packages and the
DOH Medical Assistance Program.
SERVICE DELIVERY NETWORKS
Human Resources for Health
The Human Resource for Health Deployment Program deployed a total of 27,911 HRH in
health facilities to complement the existing pool of health professionals at the local government
units especially in the priority areas: high poverty, geographically isolated and disadvantaged
areas (GIDAs), and municipalities with indigenous people. The program aims to strengthen
the capability of local health workforce to support national and local health systems.
The DOH also granted full scholarships to a total of 1,056 medical and midwifery students
under the Pre-service Scholarship Program. As for the In-service Scholarships Program, a total
of 271 employees were granted scholarships for the Masters of Public Management Major in
Health Systems and Development.
7th National Human Resources for Health Policy and Research Forum
The HRH Network Philippines celebrated its 10th year of multi-stakeholder partnership for
HRH during the 7th National Human Resources for Health Policy and Research Forum, held
on 24 November 2017 at The Manila Hotel. The event was participated by 176 stakeholders
from various sectors including government agencies, academe, professional groups,
development partners and civil society.
Centered on the theme, Keeping Momentum: Accelerating Progress towards Sustainable

Human Resources for Health for National Development and Universal Health Care , this
served as a platform for open discussions, directions, challenges, and best practices among
stakeholders in order to harmonize HRH policies and systems and strengthen national health
workforce planning.
During the event, the Department renewed its commitment to support the Network and its
initiatives, recognizing the importance of HRH in the attainment of Universal Health Care.
Secretary Francisco Duque at the National HRH Policy and Research Forum.
Hospital Congress 2017
The Health Facilities and Services Regulatory Bureau (HFSRB) conducted the Hospital
Congress last December 5, 2017 at Century Park Hotel, Manila. The congress aimed to obtain
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technical input from different hospital stakeholders regarding the proposed framework on
strengthening hospital regulation. It invited experts who shared their technical experiences and
insights on the following topics: global experience in hospital regulation, current health
regulatory situation and the need for updating the hospital regulatory framework, the role of
competition in regulatory reform initiative, creating a healthy regulatory environment for
innovation, and building capacity in regulation to contribute to universal health care.
Health Facilities Enhancement Program
The Health Facilities Enhancement Program (HFEP) aims to leverage public health facilities
in providing affordable quality care and specialized treatments. It includes infrastructure and
equipment projects for various types of government health facilities such as hospitals, Rural
Health Units, and Barangay Health Stations.
Two hospital modernization projects for DOH hospitals have started in 2017. The Eastern
Visayas Regional Medical Hospital will be expanded from a 250-bed to a 500-bed capacity
hospital with four buildings, complete medical equipment, and IT system. It is expected to be
operational by 2018.
The proposal to upgrade the Gov. Celestino Gallares Memorial Hospital has been approved by
the DOH and the National Economic and Development Authority.
Philippine Health Facilities Development Plan 2017-2022
The Philippine Health Facilities Development Plan (PHFDP) 2017– 2022, medium term
investment plan of the government for the rehabilitating and upgrading of existing health
facilities, and constructing of new health facilities across the country was approved by the
President in May 2017.
Innovations in Service Delivery
DOH-MIMAROPA, in partnership with the Department of Science and Technology (DOST),

installed and configured 29 solar powered health stations (SHS) in selected primary birthing
stations, barangay health centers and rural health units. Each had a 150-watt capacity of
electricity that can operate a personal refrigerator for 24 hours, 4 electric fans for 8 hours, 12
units of led bulbs for a maximum of 10 hours and a compressor for dental equipment for 6
hours. The Regional Director of DOHMIMAROPA assured that fifteen more SHS in all RHUs
with RxBOX in other areas of the region will be installed to enable remote consultations with
patients in far- flung communities. This RxBOX is a biomedical device with an electronic
medical records system and telemedicine capacity.
An air ambulance service was launched in Puerto Princesa City, Palawan on March 15, 2017.
It is one of the special projects of DOH-MIMAROPA to augment the lack of emergency
transport in the region that would carry emergency patients from far flung island municipalities
and barangays. This project was made possible in partnership with the Philippine Adventist
Medical Aviation Services, Incorporated (PAMAS).
The air ambulance has transported patients from the islands of Cuyo, Magsaysay, Balabac, and
Brooke’s Point in Palawan. Emergency patients coming from nearby Zamboanga and
TawiTawi are also being transported and brought to the nearest health facility in Palawan.
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“Type ng Bayan”
A National Blood typing initiative was held last February 28, 2017 at the Parañaque Sports
Complex. It aimed to determine blood type information of Filipino citizens nationwide to
inform them of their own blood types. This initiative used Metro Manila as its initial pilot site.
During the event, participants were provided with identification cards indicating the patient’s
name, photo, blood type, and five possible blood donors in case of emergencies. A total of
2,900 individuals were informed of their blood types.
Disaster Preparedness
National Disaster Resilience Month
The observance of the National Disaster Resilience Month (NDRM) officially commenced on
July 2, 2017 with the theme 4K’s: Kamalayan sa Kahandaan, Katumbas ay Kaligtasan ,
emphasizing the consciousness and readiness to respond to any emergency at all times.
Executive Order 29, signed on June 28, 2017 by Presidente Rodrigo Duterte, has shifted the
government’s focus from disaster awareness building to disaster resilience.
Resilient Infrastructure
The DOH implemented a Hospital Safety Index Self-Assessment Tool for 16 hospitals in the
NCR. Based on the results,
• 2 are undergoing rehabilitation and reconstruction;
• 3 were assessed by Structural Engineer; and
• 11 are in the process of procuring services of external structural evaluators
Preparing for “The Big One”
The DOH has conducted trainings and preparatory activities, including a Mass Casualty
Management Training held in February 2017 with participants from the LGUs, hospitals, and
other government offices in the NCR, for a possible magnitude 7.2 earthquake in the General
Metro Manila Area.
In addition to preparing for The Big One, DOH also supports Republic Act 10871 Basic Life
Support Training in Schools Act by spearheading the Cardiopulmonary Resuscitation (CPR)
campaign to capacitate one member of every family to deliver CPR when needed. As of July
2017, a total of 450 or 30% of DOH Central Office employees had been trained on Hands-Only
CPR as support for the Philippine Heart Association.
Regional Offices and DOH hospitals are also engaging in the same endeavor to achieve CPR-
Ready status. Members of the Department of Education - NCR participated in a Basic Life
Support Provider’s and Training of Trainer’s Course last November 2017 to develop a pool of
trainers to initiate and support the implementation of RA 10871.
5K Launching in Marikina
Lessons from the typhoon Yolanda and other disasters experienced by the country have
prompted DOH to formulate the five-year strategic plan with a vision aptly called 5K,
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Kaligtasan pangKalusugan sa Kalamidad sa Kamay ng Komunidad . This highlights the vision

of disaster health safety in the hands of the community. Last July 17, 2017, the Health
Emergency Management Bureau launched 5K in Marikina City.
Response to Emergencies and Disasters
Marawi Siege
During the Marawi Siege in Lanao del Sur which started in May 23, 2017, the DOH, through
the members of Task Force Bangon Marawi ensured the provision of public health services.
The DOH and partners provided PHP 222,388,985.61 financial assistance to the affected
regions. The Department also mobilized 1,250 health personnel, 25 of which are Maranao
speaking nurses, to affected areas in Region X and ARMM to provide public health services.
Such services were delivered from May to December 2017. Services provided includes disease
surveillance; water, sanitation & hygiene; nutrition; and mental health and psychosocial
support.
Surigao Earthquake
A 6.7 magnitude earthquake shook Surigao last February 10, 2017 and the city was declared
on a state of calamity. Safety was ensured by the local government unit along with the help of
the neighboring regions. With psycholgical support among the priority services to be delivered,
Mental Health and Psychosocial Support (MHPSS) teams from the Province of Dinagat
Islands, Agusan del Norte, Surigao del Sur, Drug Treatment and Rehabilitation Center (DTRC)
- Caraga, Ateneo de Davao University, Xavier University, DOH Health Emergency
Management Bureau (HEMB) and the March for Christ Group stepped in to offer related
services.
An estimated total of PHP 5,833, 828.40 worth of medicines and logistics was provided by the
DOH to assist the affected areas.
FINANCING
PhilHealth
The Philippine Health Insurance Corporation (PHIC) covers 93% of the projected population,
as of 2017. The Point of Service Program was implemented in 2017, with an allocation of PHP
3 Billion, to enroll poor Filipinos who are not yet PhilHealth members at the time of
hospitalization. Indigents, identified through the Department of Social Welfare and
Development’s Listahanan II, continue to be subsidized through revenues from the Sin Tax.
PhilHealth benefit packages have been updated and expanded and the existing PhilHealth
policy on No Balance Billing was also revised to improve its implementation and reduce the
medical expenses of poor Filipinos.
New policies to increase the quality of services were also issued such as the Accreditation for
Medical Detoxification Package Providers and Adoption of the Enhanced Benchbook for
Hospitals and Non-Hospital Facilities.
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GOVERNANCE
Performance Governance System
The DOH renewed its pursuit for transformational governance through the Performance
Governance System. After being awarded with the two critical stages: Initiation in 2009, and
Compliance in 2010, the DOH is aiming to achieve the two final stages, Proficiency by 2019
and by 2022 Institutionalization.
Electronic Medical Records
Investing in eHealth will support the current health system in ensuring access to health care
services and access to real-time information for decision-making. The use of Electronic
Medical Records (EMR) is one of the applications of ehealth.
As of December 2017, 63% of 2,589 Rural Health Units have iClinicSys or other EMRs; 351
hospitals have Stage 1 EMR; and 124 hospitals have Stage 2 EMR based on the classification
of the Hospital EMR adoption model.
Legislation
Comprehensive Tax Reform for Acceleration and Inclusion
After more than a year of legislation, Republic Act 10963, or the first package of the
Comprehensive Tax Reform for Acceleration and Inclusion (TRAIN) was signed by the
President on December 19, 2017. The DOH has consistently manifested its support on this
landmark fiscal reform, more so when the sweetened beverage tax – a priority legislation of
the DOH, was adopted by the 17th Congress as a component of the TRAIN.
Initial estimates report that the revenue of the Sweetened Beverage Tax will contribute PHP
52.0 Billion to the pooled revenue of TRAIN, in which 70% will be allocated for Infrastructure
Projects and 30% for Social Services. A portion of the TRAIN revenue is expected to fund the
development and expansion of health facilities in the country, and other interventions to enable
health-promoting environments such as the provision of clean and potable water systems in all
public schools. Furthermore, the additional revenue from the tobacco tax is expected to
contribute an additional PHP 2.0 Billion to the earmarked revenues for health, hence sustaining
the funds needed to drive the planned health reforms of the DOH.
Responsible Parenthood and Reproductive Health (RPHI) Act 2012
The RPRH Law has faced various opposition through the years. The greatest challenge of the
implementation of this law was the issuance of the Supreme Court’s Temporary Restraining
Order (TRO) to the Department of Health (DOH) and Food and Drug Administration (FDA)
last June 17, 2015. Two years of legal crusade and urgent call for the lifting of the TRO, ensued
the President to issue the Executive Order (EO) No. 12 in January 2017. The EO directs the
achievement of zero unmet need to modern Family Planning (FP) through strict
implementation of the RPRH Law. The DOH is positioned to achieve zero unmet need of
2,000,000 poorest of the poor Filipinos by 2018.
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Executive Orders on Health
Three Executive Orders that promote health were signed by the President in 2017:
 January 9, 2017: Executive Order No. 12: Attaining and Sustaining Zero Unmet Need for
Modern Family Planning through the Strict Implementation of the Responsible Parenthood
and Reproductive Health Act, Providing Funds Therefor and for Other Purposes which
identifies fund sources and mechanisms to accelerate attainment of the targets for modern
Family Planning.
 May 16, 2017: Executive Order No. 26 on the Establishment of Smoke-Free Environments
which prohibits smoking in public spaces and regulates sales and advertisements for
tobacco products.
 June 20, 2017: Executive Order No. 28 Providing for the Regulation and Control of the Use
of Firecrackers and Other Pyrotechnic Devices which bans individuals from using
firecrackers.
National Staff Meetings
The DOH National Staff Meeting (NSM) is one of the agency’s multi-sectoral, high-level
meetings which discusses strategic directions for the health sector. This meeting is participated
in by DOH Execom Officials, Central Office and Regional Directors, Chiefs of DOH
Hospitals, Specialty Hospitals, Treatment and Rehabilitation Centers and attached agencies.
Partners and stakeholders in health are also invited to observe and present in the NSM on
relevant matters. This event is conducted quarterly or per directive of the Secretary.
In 2017, three NSMs were successfully conducted in Baguio City (January 1113, 2017), Ilocos
Norte Province (July 25-28, 2017) and in Iloilo City (October 26-27, 2017) respectively.
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Department of Transportation
DEPARTMENT OF TRANSPORTATION (DOTr)
2017 has been an incredible year for the Department of Transportation (DOTr), although not
without setbacks and challenges. From policy changes and reforms to infrastructure projects
and other large-scale initiatives, your DOTr is connecting cities, moving people, nurturing
businesses, and providing the brand of service that Filipinos truly deserve.
This year, DOTr launched the PUV Modernization Program, the biggest transformational
initiative of the Duterte administration that will bring about a comprehensive system reform in
the country’s transport sector. This was and still is being met with challenges, given its wide
ranging impact. But the DOTr is bent on implementing it, no matter the difficulties, because
the longer this reform gets delayed, the longer people will suffer. We can’t afford to wait for
the time when our public transport system becomes totally unreliable and irreparable.
Our big-ticket infrastructure projects marked milestone after milestone this year --- budget
approvals, designs, procurement processes, groundbreakings, and official start of construction.
In the railways sector alone, DOTr broke ground for the LRT-1 Cavite Extension, LRT-2 East
Extension, and the long-delayed Common Station. We made significant progress for the Manila
– Clark Railway, Manila – Bicol Railway, got initial funding for Mindanao railway, and sealed
Japan’s commitment to build the country’s first subway system.
In the aviation sector, global organizations hailed the improvements DOTr been doing with our
airports in terms of safety and on-time performance. No Philippine airport was named among
the world’s worst this year, which all the more inspires us to work harder to be amongst the
best. The DOTr is improving terminals and expanding runways of several airports nationwide,
including making them capable for night-landing operations. Twenty-four hour construction of
airports in Bicol, Bohol, and Cebu are all on track and on schedule.
We are making our seas and coasts safer with the reinforcements from countries such as Japan,
France, Russia, and Germany. The much-needed make-over of our ports are being undertaken
in order to add more RORO ramps, increase operational efficiency, and improve passenger
experience. The country’s first barge terminal will be the first DOTr project under the Build
Build Build Infrastructure Program to be opened next year
Highlights of Implementation as of December 31, 2017

A. AIRPORTS AND AVIATIONS
1. 8 PH Airports Awarded
For the first time, the Philippines was given a one-star rating for On-Time Performance
(OTP) by the Official Aviation Guide (OAG).
Eight Philippine airports got a one-star rating, with the Iloilo International Airport
landing 14th place among airports with one-star ratings- besting Kuala Lumpur, Hong
Kong, and Incheon.
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DOTr – Annual Accomplishments for CY 2017
Out of the 79 airports [with 36 airports operating commercial flights] managed by

CAAP all over the country, other Philippine airports that earned star ratings on OTP are
NAIA, Bacolod, Davao, Tacloban, Laguindingan (CDO), Kalibo and Puerto Princesa.
The OTP star rating is designed to benchmark against set criteria, defined by industry
and flight status information experts. OTP is measured across the whole year based on
12 months’ rolling performance.
2. PH Airports Pass Global Safety Audit
The DOTr - Civil Aviation Authority of the Philippines (CAAP) recently passed the
Universal Safety Oversight Audit Programme (USOUP) of the ICAO Coordinated
Validation Mission (ICVM) conducted from May 30 to June 8, 2017.
Based on the results, CAAP, the regulatory body with jurisdiction over the entire civil
aviation system of the Philippines, has improved its effective implementation (EI) with
current overall results of 69.68%, which is above the world average of 64.85%. This
means the country complies with international safety standards.
The current result also showed a significant 10.77% improvement than the 58.91%
rating of CAAP in 2016. CAAP was also cleared on issues relating to Significant Safety
Concerns (SSCs).
ICAO is a specialized agency of the United Nations with 191 member states that sets
standards and regulations necessary for aviation safety, security, and efficiency as well
as aviation environmental protection.
3. PAL Settles P6B Debt
Flag carrier Philippine Airlines (PAL) was

finally made to settle its PhP6-B unpaid air
navigational charges to the national
government, which were incurred since 1970’s
up to 30 July 2017.
Atty. Clara De Castro, PAL Vice President for

Legal Affairs, brought the company checks to
the office of the Civil Aviation Authority of the
Philippines (CAAP) in Pasay to settle its
financial obligations to the government.
The check amounting to PhP5,677,887,615 was turned over to CAAP Chief Accountant
Raul Eusebio. On the other hand, the check worth PhP258,594,230.33, net of taxes, was
turned over to Manila International Airport Authority (MIAA) Assistant General
Manager for Finance and Administration Arlene Britanico.
4. New (Bohol) Panglao Airport

Status: Ongoing Construction
Target Completion: June 2018
Cost: PhP7.8-B
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The PhP7.8-B project, with a terminal spanning 13,337 square meters, will serve as the
premiere gateway to the province and the island paradise of Panglao, a thriving tourist
destination. It was designed to be the country’s first eco-airport and “Green Gateway
to the World,” which will be held to the highest standards of green and sustainable
structures.
5. World’s First Resort Airport: Mactan-Cebu International Airport

Target Completion: June 2018
Cost: PhP14-B
The world’s first resort airport will rise in Mactan, Cebu in 2018. The international
passenger terminal building will have world-class facilities and will be able to
accommodate 12 million passengers a year. The new terminal will not just be a gateway
or a transfer point, but will provide a distinctly Filipino experience. As of August 2017,
construction is already 70% complete.
6. PH’s Scenic Gateway: Bicol International Airport

Target Completion: 2020
Cost: PhP4.798-B
After being put on hold for 11 years, the Bicol International Airport finally resumed
construction this year. Following the groundbreaking of Phase 2 in December 2016,
construction works for land-side facilities, which includes 17 buildings for cargo, air
traffic control, material recovery facilities, and water reservoir, have started. The airport
will be built on a 148-hectare lot in Daraga, Albay. It will have a 2,100-meter runway
strip with a scenic view of Mount Mayon.
7. Night Rating of Airports
The DOTr targets to equip all 42 airports nationwide with night-landing capabilities.
With this, domestic flights departing NAIA do not have to be crammed during day time.
Under the new administration, additional four airports have been made capable of night-
time flight operations. These are: Legazpi, Roxas, Dumaguete and Caticlan. Naga,
Dipolog, Cotabato and Cauayan are targeted to be completed by 2018. This increases
the total of night-rated airports from 19 to 23.
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8. Upgrading Regional Airports
All over the country, airports are being improved and modernized. Expansion and
improvement works have started for Bacolod (Silay) Airport, Davao International
Airport, Iloilo Airport, and Laguindingan Airport.
To accommodate wide body aircraft, which are used in regional flights, runway
lengthening and widening projects in Kalibo, Virac, Calbayog, Ozamiz and Cotabato
have begun
9. More Routes for Premium Airport Buses
Twenty-one (21) units of Mercedes Benz buses were deployed to ferry passengers from
NAIA. UBE Express currently has four main routes: Entertainment City (NAIA – Mall
of Asia), Robinson’s Route (NAIA – Intramuros, Robinson’s Manila, and Ermita),
Makati Route (NAIA – Ayala Center), and the Grand Prix Route (NAIA – Grand Prix
Hotel, Pasay).
From January to November 30, 2017, a total of 233,256 riders have availed of the
services of UBE Express.
Each bus is equipped with ergonomically sound seats, Wi-Fi, and onboard display of
arrival and departure information. The buses also passed Euro V emission standards
10. Passenger Assistance in Airports
In order to effectively implement the Air

Passenger Bill of Rights (APBR), a contact
center was launched on April 2017. This will
augment the Passenger Rights Assistance
Desks (PRAD) that were set up at airports
nationwide in 2016. From the initial five
airports, an additional 25 commercial airports
were set up with PRADs in 2017. An
additional 98 Passenger Rights Assistance
Officers were also deployed.
The Civil Aeronautics Board (CAB) has also

outsourced a contact center provider, DOS-1,
as a single point contact for 24/7 passenger
assistance or Hotline 165-66. The minimum
front-line transactions that will be provided
through this hotline include:
a. Answering queries relating to the provisions of the APBR;
b. Providing simple solutions to air passengers’ concerns;
c. Receiving complaints arising from violationof APBR; and
d. Endorsing to airline concerned for immediate resolution.
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11. Streamlining Aviation Process
Upon the directive of Transportation Secretary Arthur Tugade, the Civil Aeronautics
Board (CAB) was able to streamline the checklist of requirement by reducing the
number of documents being required from applicants of a Permit to Operate Air
Transportation Services. From the maximum number of 36 requirements for original
applications, CAB reduced them to six basic requirements; while for renewal, CAB cut
the requirements from a maximum of 24 requirements to only three basic requirements.
12. Senior Citizens and PWD Discount on Online Booking
Senior citizens and Persons with Disabilities (PWDs) may now avail of a 20% discount
when booking a domestic flight online. The DOTr - Civil Aeronautics Board approved
yesterday, 13 July 2017, the Resolution requiring local airlines to give a 20% discount
on tickets purchased via the carrier’s website or a mobile application. Prior to this, the
discount was only applied to face to face transactions.
Under the Resolution, senior citizens, PWDs, or their representatives must input the
passenger’s details including date of birth and ID number indicated in the Senior Citizen
or PWD card.
CAB directed airlines to establish in their websites the necessary system to be able to
process the 20% discount based on the actual fare, including promotional fares that
were directly sold by the airlines. The discount, however, shall not cover lawful taxes
and other fees and charges imposed in relation to domestic air travel.
B. RAILWAYS
1. Common Station
After eight years of delay, the motions of construction for the Common Station has
finally begun. At the groundbreaking ceremony in Quezon City last 29 September 2017,
DOTr Secretary Arthur Tugade expressed his gratitude to the private sector for setting
aside differences for the common good. He also said that building the Common Station
is proof that the government puts public convenience and common benefit at front and
center.
Executive Secretary Salvador Medialdea, who represented President Duterte during the
event, said that the Common Station is a “great gift to the riding public.” The Common
Station will connect the four main lines in Metro Manila: MRT-3, LRT-1, MRT-7, and
the soon to be constructed Metro Manila Subway. At 13,700 square meters, the
Common Station will have a spacious concourse area that will facilitate seamless
transfer of passengers from one line to another. It will be built between SM North EDSA
and Trinoma.
2. LRT-1 Cavite Extension

Status: Design and Pre-Construction
Start of Construction: 2018
Target Completion: 2022
Cost: PhP65-B
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After years of delay, the DOTr and its private partners finally broke ground for the
LRT-1 Cavite Extension last May, signaling the start of construction activities. The
11.7-kilometer extension will connect the current line from Baclaran to the Niog area
in Bacoor. Once completed, travel time from Bacoor to Manila would be cut from over
two hours to about 20 minutes.
The contract for the acquisition of 120 new Light Rail Vehicles (LRVs) for the Light
Rail Transit Line 1 (LRT-1) south extension project has been signed.
3. New Conveyance System for LRT-2
In order to enhance accessibility and convenience of rail commuters, the Light Rail
Transit Authority (LRTA) simultaneously opened last 19 October 2017, 32 new
elevators and 13 escalators in various LRT Line 2 (LRT-2) stations.
Apart from the conveyance system, rehabilitation projects of LRT-2 include the
systematic replacement of all train air-conditioning systems, restoration of four trains
and rehabilitation of station facilities and equipment.
4. MRT-7 In Progress
The construction of the MRT Line 7 is on

track and on schedule. The construction of
columns along Regalado and Doña Carmen
streets have been completed. Expected to be
completed and operational by 2020, the
MRT7 project will service over 400,000
passengers in Metro Manila and nearby
provinces of Bulacan and Rizal. Composed of
14 stations, the 22 km MRT7 rail transit
system will connect North Avenue in Quezon
City to San Jose Del Monte City in Bulacan.
Among the areas where stations shall be
constructed include: North Avenue, Quezon
City Memorial Circle, University Avenue,
Tandang Sora, Don Antonio, Batasan, Doña
Carmen, Regalado, Mindanao Avenue,
Quirino, Sacred Heart, Tala, and San Jose Del
Monte.
It would be connected with LRT-1, MRT-3, and the Metro Manila Subway via the
Common Station, which would be located between SM North EDSA and Trinoma mall.
5. LRT-2 East Extension Opens in 2018
The LRT-2 East Extension Project involves the construction of a 4.0 kilometer
extension of the existing LRT-2 System from Santolan, Pasig City to Masinag in
Antipolo. Rizal. Two additional stations will be built: (a) the Emerald station, which
will be located in front of Robinsons Metro East and Sta. Lucia in Cainta, Rizal; and
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(b) the Masinag station, which will be located before the Masinag Junction in Antipolo
City. These stations are expected to accommodate 80,000 passengers/day.
Once completed, the extended line is expected to significantly cut the commuting time
from Masinag in Antipolo to Claro M. Recto in the city of Manila by 30 to 40 minutes
from an average of three hours of driving on the road.
6. Metro Manila Subway
Following the project’s approval by the NEDA Board last 12 September 2017,
President Rodrigo Duterte and Japanese Prime Minister Shinzo Abe has signed the
Exchange of Notes during the ASEAN Summit in November. This is the binding
commitment of the Japanese government to finance and support the project. This will
be succeeded by the signing of the Loan Agreement in January 2018.
7. MRT-3: Termination of Maintenance Contract
The DOTr served its final decision to terminate its contract with Busan Universal
Railways Inc. (BURI) for the maintenance of the Metro Railway Transit 3 (MRT-3)
system, general overhauling of 43 Light Rail Vehicles (LRV), total replacement of its
signaling system, and other additional maintenance works.
Along with this, DOTr Sec. Tugade signed the establishment and composition of the
MRT-3 Maintenance Transition Team (MTT) that temporarily took over the
maintenance works of MRT-3 while the procurement of a new maintenance provider is
being processed. The Philippine National Railways (PNR), and Light Rail Transit
Authority (LRTA) also committed to provide sufficient technical support and expertise
to ensure the smooth transition of MRT-3 maintenance works.
8. NORTHRAIL – SINOMACH Settlement
After a series of negotiations that started in

January 2017, North Luzon Railways Corporation
(NORTHRAIL), represented by its ex-officio
Chairman, DOTr Secretary Arthur P. Tugade,
together with Bases Conversion and Development
Authority (BCDA) President Vivencio B. Dizon,
concluded an out-of court Settlement Agreement
over its dispute with China National Machinery &
Equipment Corp. Group (now named China
National Machinery Industry Corporation or
SINOMACH), the former contractor of the 80km Caloocan to Malolos segment of the
NORTHRAIL Project.
Under the terms of the Settlement Agreement, the parties have agreed to (1) waive their
claims against each other and declared that there will be no more payment by
NORTHRAIL to SINOMACH, and vice versa, and (2) share the remaining arbitration
fees in equal proportions.
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9. Launching of Passenger Assist Railway Display System (PARDS)
In partnership with Trackmate Business Solution, Inc. (TBSI), the Light Rail Transit
Authority (LRTA) launched the Passenger Assist Railway Display System (PARDS)
that provides the LRT-2 commuters a real-time communication while on-board the
train.
Also, put on display are the train arrival and departure, train location, LRTA
announcement features, proximity tagging and other info-tainment. It is included in the
project the installation of 400 sets of 19” LED monitor, 40 sets of GPS, 40 sets of CPU
and 40 sets of CCTV Camera across ten (10) trainsets.
C. ROAD TRANSPORT
1. The PUV Modernization Program
19 July 2017 - Signing of DOTr-DO 2017-011 or the Omnibus Franchising Guidelines

(OFG) which introduces regulations that will generate (a) new and rationalized routes,
(b) public transport services designed to meet travel demand; (c) vehicle specifications
to ensure safety, accessibility and low emissions; (d) consolidation of small individual
operators into larger entities that will have the capability and resources for higher
quality services, and; (e) a transition period of three (3) years. This technically lifts the
moratorium on the issuance of franchises.
Signing of the DOTr-DILG JMC 001 series of 2017 or “Guidelines on the Preparation
and Issuance of Local Ordinances, Orders, Rules and Regulations concerning the Local
Public Transport Route Plan (LPTRP)” which provides the guidelines to be used by
LGUs in preparing their LPTRPs which will be used by the LTFRB as basis for
franchise issuance.
30 April 2017 - MOU Signing between DOTr and Landbank which gave rise to the
SPEED Jeepney program.
11 September 2017 - MOU Signing between DOTr and DBP PASADA (Program
Assistance to Support Alternative Driving Approaches).
12-14 September 2017 - Capacity building and pilot testing of the LPTRP Manual in
General Santos City.
Ongoing - Preparations for initial implementation are currently ongoing in the
following areas: Metro Manila, General Santos City, Tacloban City, Davao City, Cebu
City, and Cagayan de Oro City.
2. Unifying Toll Systems
Toll operators of all expressways in the country finally agreed to make toll collection
systems interoperable. On 15 September 2017, the DOTr, through the Toll Regulatory
Board (TRB) and Land Transportation Office (LTO), along with the Department of
Public Works and Highways (DPWH) and the Bases Conversion and Development
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Authority (BCDA), signed a Memorandum of Agreement (MOA) for Toll

Interoperability with expressway operators to unify toll collection in the country.
Under the MOA, expressway operators will be required to update their collection
systems to allow interoperability and integration. For electronic payments, each
operator shall install and maintain an Electronic Transit Media Reading Device in at
least two entry and exit toll booths, which is capable of reading, accepting, and
processing any electronic transit media approved by the TRB. For cash payments, each
toll road operator will be required to install and maintain an Entry Ticket Reading
Device in at least two entry and exit toll booths that accepts and processes any entry
ticket. Motorists can use their electronic tags from one toll road operator to another.
When paying in cash, motorists will get a ticket once at entry and pay once at exit.
3. DOTr – TRB Issues Permit to TPLEX
The DOTr-Toll Regulatory Board (DOTr-TRB) issued last 29 November 2017 a Toll
Operation Permit (TOP) to the Private Infrastructure Development Corporation (PIDC)
for the maintenance and operation of the Binalonan-Pozorrubio Segment.
The TOP was issued after a joint inspection conducted by the Department of Public
Works and Highways (DPWH), TRB Technical Staff, and representatives of PIDC,
who confirmed that the particular portion of TPLEX is “substantially complete and is
safe to be operated commercially.”
Approximately 10.10 kilometers, this segment is the second to the last portion of the
TPLEX project that would be constructed by PIDC.
To date, almost 20,000 vehicles traverse the stretch of existing TPLEX segments daily,
from La Paz, Tarlac to Urdaneta, Pangasinan.
4. United Against Traffic: i-ACT Expands Operation
The Inter-Agency Council for Traffic or (i-ACT) was formed to promote cooperation
in the fields of traffic decongestion, commuter’s safety, anti-colorum operations and
strict enforcement of traffic laws, rules, and regulations within Metropolitan Manila.
The council is composed of seven national government agencies namely, the DOTr;
Philippine National Police (PNP); Metropolitan Manila Development Authority
(MMDA); Metro Manila Council (MMC); Land Transportation Office (LTO); Land
Transportation Franchising and Regulatory Board (LTFRB) and the Philippine Coast
Guard (PCG).
On 19 October 2017, the Task Force Alamid was formed. This is a composite team
tasked to help confront the traffic prone areas in Metro Manila and adjacent cities
composed of representatives from DOTr, PNP-HPG, MMDA (Sidewalk Clearing
Group), LTO, LTFRB, AFP, VolunteerGroup (Ligtas Patrol).
The i-ACT has been continuously conducting the following operations:

a. Franchise-related operations such as terminal inspections, among others;
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b. Implementation of R.A. No. 4136, Anti-Distracted Driving Act, Anti-Drunk and

Drugged Driving Act, Joint Administrative Order No. 01-2014, and other non-
franchise related operations.
c. Implementation of the Anti-Carnapping Act and;
d. Apprehension of illegally parked vehicles
5. Roll out of Driver’s Licenses with 5-year Validity
The DOTr-Land Transportation Office (DOTr-LTO) began to roll out the new driver’s
license with five-year validity on 29 August 2017. The new license cards have security
features that will address the issue of fake licenses. The new license card, which is
made of polycarbonate material, has a total of 32 security features –22 on the front and
10 at the back-- to make it difficult for forgers to copy. Among the security features of
the new license include the 2-D barcode wherein the fingerprint of the owner is
embedded along with his photo.
Apart from the new features, LTO is studying to formulate a system wherein the validity
of the license cards could last up to 10 years. Under the planned scheme, a driver who
has not incurred any traffic violation can have the validity of his license extended up to
ten years.
LTO is also set to start distribution of license plates by the first quarter of 2018.
6. Launch of Driver’s Academy
In an effort to further professionalize the public transport sector, the DOTr, through the
Land Transportation Franchising and Regulatory Board (LTFRB), nationwide launched
last August 17, 2017 the PUV Drivers’ Academy.
DOTr established of the Drivers’ Academy, one of the components of the Public Utility
Vehicle Modernization (PUVM) Program, to provide PUV drivers with seminars and
trainings to re-familiarize them with basic road safety, driving courtesy, and traffic rules
and regulations.
Over 700 PUV drivers participated in the initial training seminar. Certificates of
completion will be given to PUV drivers who would undergo and finish the one day
training seminar conducted by instructors and resource persons from the LTFRB.
7. Addressing Three Million Backlog on Licenses
One of the most pressing challenges that was carried over to the new administration
was the three million backlog in driver’s licenses, a result of writ of injunction in
October 2015 issued by Manila RTC to the supplier due to questionable contract. Since
then, applicants for driver’s licenses were only given receipts to allow them to drive a
vehicle without being apprehended.
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But as soon as the Manila RTC lifted the injunction in June 2016, the new LTO
administration under the leadership of Assistant Secretary Edgar Galvante started
working on addressing the backlog. On 18 December 2016, the LTO finally started
releasing the long-delayed driver’s license cards with three-year validity. The backlog
was completely addressed by February 2017.
8. License Plates Delivery Expected in March 2018
The Land Transportation Office (LTO) has already issued the notice of award (NOA)
to the winning bidder in the procurement of license plate in the amount of PhP978.8-M
on 01 December 2017. The winning bidder, Trojan Computer Forms Manufacturing
Corporation and J.H. Tonnjes E.A.S.T. GmbH & Co. KG Joint Venture, has already
been required to provide the performance security. Initial delivery is expected sometime
in March 2018. It can be remembered that the procurement of license plates for 2016,
2017 and 2018 was delayed due to the lack of budget when the present administration
took over. It was only in November 2016 that DOTr Secretary Arthur P. Tugade
approved the requested budget and set aside the amount of PhP 1-B from DOTr’s
budget for LTO’s procurement of license plates.
9. Parañaque Integrated Terminal Exchange
Envisioned to be a modern transportation hub, the Parañaque Integrated Terminal

Exchange (Parañaque ITX) will provide seamless interconnectivity of the different
modes of transportation from the neighboring provinces south of Metro Manila. This
ensures a safe, convenient, and hassle-free travel experience for the commuting public.
Combined with the rationalization of provincial and city routes, this 2.9 hectare facility
will maximize road usage through the reduction of vehicle volumes and trafficflow
improvement, provide efficient interconnections between different transport modes and
services, and uplift the public passenger experience thru its modern and world-class
amenities. Parañaque ITX is a public-private partnership (PPP) project between the
DOTr and Megawide & Waltermart (MWM).
10. DOTr Backs Multi-Modal Terminal in Marikina
Consistent with efforts to decongest EDSA and move people faster, the DOTr expressed
support for the Metro Manila Eastern Multi Modal Transport Terminal in Marikina.
Transportation Secretary Arthur Tugade, MMDA Chairman Danny Lim, and DOTr
Undersecretary for Road Tim Orbos joined 1st district of Marikina Rep. Bayani
Fernando in inspecting the terminal last 14 August 2017.
Tugade said the DOTr has always been supportive of Local Government Unit (LGU)
initiatives that seek to improve connectivity and the transportation system in the
country.
Meanwhile, Usec. Orbos said that the multi-modal terminal located across SM Marikina
will reduce vehicle volume in EDSA.
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Tugade also said that the DOTr will continue to develop the Pasig River Ferry terminal
and expand Point-to-Point (P2P) bus routes to provide the terminal with
interconnectivity and different modes of transport. He also suggested to the Marikina
LGU to make the terminal technology based for faster and more commuter-friendly
operations.
11. Developing an Intelligent Transport System
Singapore has one of the smartest and most advanced transportation systems in the
world. This is why the DOTr collaborated with the Singapore Cooperation Enterprise
through a Memorandum of Understanding that would formalize both governments’
commitment to collaborate in areas of traffic management policies and solutions,
leading to the development of an Intelligent Transport System (ITS) for Metro Manila.
The MOU was signed between Transportation Secretary Arthur Tugade and SCE Chief
Executive Officer Kong Wy Mun last 31 August 2017.
The collaboration would include developing traffic policies and recommending

tailored-fit infrastructure to help resolve traffic congestion in Metro Manila. The ITS
solution will take a comprehensive and holistic approach involving policy alignment,
regulation changes, capacity building, and engineering know-how build up that
includes the setting up of a centralized traffic and incident management system.
On October 11, Secretary Tugade visited the ITS center in Singapore and witnessed
how the ITS center monitors and controls traffic in the whole of Singapore. In
November, the first Technical Working Group meeting between the DOTr and
Singapore was conducted, bringing us one step closer to the development of the
technology in the Philippines.
12. P2P Bus Services Reach Provinces
From only two routes, the Premium Pointto-Point (P2P) Bus Transport Service now has
18 routes, including Laguna, Cavite, Clark, and Antipolo. Out of the 18 routes, 16 are
operational, while two other routes have been awarded but are awaiting for permits and
clearances to operate.
At least five more routes are expected to be operational before the end of 2017. An
Additional 19 routes are also targeted to be bidded out before year-end and are expected
to be operational at the start of 2018.
As of December 2017, there are already 141 units with special permits issued by the
Land Transportation Franchising and Regulatory Board (LTFRB) to ply the said routes.
The DOTr will extend the P2P bus service to other highly urbanized cities and provinces
throughout the country.
13. 20% Discount for Students during Weekends and Holiday
On 11 October 2017, the Land Transportation Franchising and Regulatory Board

(LTFRB) issued Memorandum Circular No. 2017-084, giving 20 % discount to
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students during weekends. It took effect on 28 October 2017. Under the circular,
students can avail of the 20 per cent discount from Monday to Sunday, including
summer breaks, legal and special legal holidays. Post-graduate students or those taking
up medicine, law, masters, and doctoral degrees may not avail of the said fare discount.
14. Road Safety Policies
a. Philippine Road Safety Action Plan (PRSAP)
The PRSAP was updated and aligned with international conventions. It used safe
systems approach, which recognizes that people make mistakes and safe system
(seatbelts, helmet, lower speeds, road engineering, etc.) are covered. The PRSAP
consultation was conducted nationwide (Manila, Baguio, Iloilo, and Davao) and the
soft launch of the project was held last 19 November 2017 during the World Day
of Remembrance for Road Traffic Victims. The final draft of the PRSAP and its
executive summary is for finalization and publication, while a Department Order
creating a National Road Safety Unit, which is one of the major recommendations
of the PRSAP, has been signed.
b. Speed Limiter Act Implementing Rules and Regulations (IRR)
The IRR has been signed and is due for publication. The DOTr is also currently
coordinating the supply, standards, and accreditation process for distributors,
installers and testing facilities with the Department of Trade and Industry.
A Joint Memorandum Circular (JMC) with the Department of the Interior and Local
Government and Department of Public Works and Highways and was signed in
November 2017. The JMC allows local government units to set lower speed limits
in their jurisdictions and selected sections of national highways with highly dense
population of pedestrians and motorists. A database shall be created by the DOTr
and use it in setting speed limits in public utility vehicles.
c. Anti-Distracted Driving Act Implementing Rules and Regulations
The IRR was signed last April 14 and took effect last July 16. Database for Road
Incidents Visualization Evaluation and Reporting System (DRIVERS). Separate
Memorandum of Agreement between the Philippine National Police and
Metropolitan Manila Development Authority for the data collection for DRIVERS
was signed in November 2017. Meanwhile, a Memorandum of Understanding with
the Department of Health for the linking/recording of injury and fatality data in
DRIVERS was signed on March 2017.
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D. MARITIME
1. PCG personnel promoted for Marawi Service
Forty Philippine Coast

Guard (PCG) personnel
received a spot promotion
for their service in the five-
month conflict between the
government and the Maute
group in Marawi. Some
officers were also given
medals of merit. The PCG
personnel were mostly
assigned to its Special
Operations Group and its
Anti-Terrorism Unit, and
spent days and nights
patrolling the waters near Marawi City and Iligan City. They were deployed to secure
Lanao Lake and the port of Iligan to block terrorists, supplies, and logistics, from
entering the city to reinforce the Maute fighters. The PCG will also be establishing a
station in Marantao area of Marawi to continually serve as patrol force for peace and
order, as well as protect the marine environment there and ensure the safety of travelers.
2. ASEAN RORO: Linking PH and Indonesia
A shorter trade route connecting Davao-General Santos-Bitung, Indonesia ports was

launched on 30 April 2017. This new route reduced shipping time from an average of
three to five weeks to just two to three days. As a result, operational costs were reduced
from US$ 2,200 to US$ 700 per twenty foot equivalent unit (TEU), a 214% reduction
that is equivalent to US$1,500 of savings. The management is undergoing the process
of reviewing the policies, rules and regulations on domestic and international shipping
to provide flexibility to interested vessel operators. Also, the Philippine government
requested the Indonesia counterpart to settle the issues on customs and trade.
The PCG has already deployed two vessels in

Davao, one 44-meter MRRV and one 35-meter
SARV programmed to ensure the safety and
security of shipping and the Davao-Gen San-
Bitung Route.
The new maritime route aims to boost trade

relations between the two countries and support
the economic development of Mindanao and
North Sulawesi, while establishing the ports in
Davao and General Santos as international
gateways for trade and business.
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3. Improved Port Operations
Sustained increase in cargo traffic in 2017 is evident with the expected 3.10% (7.566
MMTs) improvement from the recorded volume in 2016. In particular, domestic cargo
is seen to improve by 6.64% (6.261 MMTs) with notable cargo performance registered
at PMOs Panay/Guimaras, Davao, Negros Occidental/Bacolod/Banago/BREDCO,
Misamis Oriental/Cagayan de Oro, and NCR South.
Container volume handled at the ports as of the review period surpassed the previous
year’s performance by 48.16% (3,139,848 TEUs). Domestic container traffic posted
most of the recorded traffic improvement with 88.01% (2,320,744 TEUs) while foreign
container volume expanded 21.09% (819,103 TEUs).
Passenger traffic continues to post growth with 4.73% (3,262,391), as of the period in
review driven by the continuous reliance by the sea-travelling public on RORO vessels,
fast crafts, and motorized bancas as primary mode of transportation for domestic inter-
island connectivity.
The positive stream in passenger traffic may have also been favorably influenced by
the government’s domestic eco-tourism programs encouraging leisure inter-island
RORO travel to tourist destinations such as Siargao, Puerto Galera, Bohol, Coron, El
Nido, and other emerging tourism sites.
During the period in review, a total of 448,795 vessels nationwide is estimated which
is a significant increase of 3.36% (14,580) over the 2016 figures attributed mainly to
surge in inter-island vessel movements
4. Modernizing PH Ports
The DOTr, through the Philippine Ports Authority, is improving and modernizing ports
nationwide.
Locally-Funded Projects (LFPs) totaled 119 as of yearend, which cover carry-over and
new projects nationwide. Of the total number of projects implemented, 44 projects are
for Luzon ports, 31 projects for Visayas ports, and 44 for Mindanao ports. These
projects include construction of back-up area, increasing berth length, and RORO
facilities in order to improve the operational and cargo handling capacities of ports.
Routine and preventive maintenance of port facilities are being carried out to ensure
that port infrastructures are kept at serviceable and safe condition. As of December, at
least 152 projects shall have been completed and 107 are ongoing. PPA has
programmed the removal of silts at various piers and harbors under a privatized set-up
to ensure that serviceable water depths are maintained for the safe navigation of large
vessels calling at the ports.
As of end of December, a total of 531,940.00 cu.m. of silts will have been removed at
the following ports and harbors: Tagbilaran, Ormoc, Guadalupe, San Carlos, Lamao,
Calapan, Roxas, Puerto Princesa, and Tubigon
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5. Faster Marina Processes
The issuance of seafarer’s book, which took 15 days in the past, now only takes one
day. The Maritime Industry Authority (MARINA) also launched an online appointment
system for quicker and efficient processing of requirements. The validity of the
Seafarer’s Identification and Record Book was likewise extended from 5 years to 10
years, benefitting around 780,000 registered Filipino seafarers. The MARINA was
likewise able to launch the formulation for a 10-year Maritime Industry Development
Program (MIDP) that aimed at making the Philippines a major maritime nation, wherein
the maritime sector plays a key role in economic growth and development
6. Digitalizing Port Systems And Operations
Pilot roll-out of the system was completed on 22-26 May 2017 at three Port
Management Offices (PMO), namely: Cagayan de Oro, Bohol, and NCR South. PPA
will have completed the system roll-out at 22 PMOs by end of December. E-Payment
will provide port users with options to settle their bills anywhere without carrying cash.
It also reduces person-to-person transaction and the opportunity for graft and corrupt
practices.
The system design and development for Internet-based Port Operations Receipting for
Terminals (iPorts) was likewise completed on 28 June 2017. System integration,
testing, and documentation immediately followed the completion of the system
development phase of the Project. Pilot roll-out of the system will have been
accomplished by end of 2017 at three PMOs.
7. Securing Safety of the Sea

a. Implementation of the Safety, Security and Environmental Numbering (SSEN)
System
This is a system that assigns unique numbers for every Philippine vessels and
watercrafts to facilitate identification and discourage the use of these vessels and
watercrafts in illegal maritime activities. It also serves as a precautionary measure
to curtail the movement of terrorist groups in the Southern Philippines.
As of 08 December 2017, Mindanao area has accomplished 99% of its
implementation. Likewise, all Coast Guard Districts have reached 67.78% for the
overall national implementation.
b. Sea Marshaling/Escorting System
This involves the deployment of PCG Teams on board passenger vessels who will
act as security and deterrent force while vessels are underway. To date, the PCG
has a total of 514 deployments and assisted a total of 1,618,510 passengers and
crews.
c. Activation of Additional Operating Units
Following the guidelines of the Senate of the Philippines regarding the presence of
Coast Guard in every coastal municipality of the country, the PCG exerted effort in
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acquiring lots for the establishment of additional District, Stations and Sub-Stations.
To date, there are 13 Districts, 64 Stations and 296 Sub-stations all over the country.
d. Maritime Law Enforcement and Maritime Security Intelligence
To date, the PCG continues its intelligence activities such as anti-piracy, armed
robbery and abduction at sea, anti-trafficking in person, anti-drug trafficking, anti-
smuggling, anti-illegal fishing/ poaching, anti-gun running, anti-illegal logging and
anti-maritime terrorism.
8. PH’s First Barge Terminal Opening in 2018
The Cavite Gateway Terminal will be the first major infrastructure program to be
inaugurated in 2018.
This will be the first barge terminal in the country, which will allow trans-shipment of
cargo from Manila port to Cavite via barges. The project will reduce the number of
trucks plying Metro Manila roads or approximately 140,000 fewer truck trips annually.
As a result, road traffic will be reduced by approximately two kilometers of trucks when
the terminal starts operations.
9. Modernization of Lighthouses
Lighthouses serve as sovereign markers in the occupied islands of the Philippines. But
more than markers, lighthouses improve the safety of navigation.
The Philippine Coast Guard has embarked on a modernization project to repair, restore,
and continually improve the operational efficiency of lighthouses in the country. As of
April 2017, the PCG lighthouse operational efficiency is at 93.87%, which translates to
552 operational light stations out of the 588 total.
For 2017, PhP22.43-M was appropriated for light house repair, while PhP38.92-M will
be used to procure LED lanterns for the upgrading of primary light stations.
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10. Acquisition of Patrol and Response Vessels
a. Floating assets from Japan
As of November 2017, seven out of the ten 44-Meter Multi Role Response Vessels
(MRRV) from Japan have been delivered, commissioned, and named after the
primary lighthouses in the country. The remaining three MRRVs are expected to
arrive and be commissioned by 2018. These floating assets will be utilized by PCG
for the conduct of environmental and humanitarian missions, as well as maritime
security operations and patrol missions.
Japanese officials also turned over three 7-meter rigid hull inflatable boats (RHIBs)
to the PCG as part of the capacity building assistance from the government of Japan.
During the turnover ceremony, Japanese Ambassador to the Philippines Koji
Haneda said Japan is always ready to assist the Philippines in securing its seas.
b. High-speed boats from France
The DOTr signed a contract with maritime technology expert and shipbuilder,
OCEA S.A. of France, for the acquisition of five brand new high-speed Coast Guard
Patrol Boats.
Under the Contract, OCEA will supply, deliver, and maintain four brand new 24-
meter Fast Patrol Boats (FPB) and one brand new 84-meter Offshore Patrol Vessel
(OPV). The French government will deliver four patrol boats before end of June
2018 and one off-shore patrol vessel on August 2019.
c. Acquiring 94-meter MRRVs
NEDA-ICC has approved the acquisition of the two 94-Meter Multi Role Response
Vessel for the PCG which is capable to operate up to Sea State 6 (Wave Height 4-
6 Meters) and could hurdle up to Sea State 8 (Wave Height 9-14 Meters) and
capable to conduct continues maritime patrol for a period of 10-15 days based on
its design patrol speed of 24 knots. The first vessel is expected to be delivered on
November 2020 and second vessel on March 2021.
d. Patrol vessels for PCG
The loan agreement was signed for the acquisition of one 82-meter Offshore Patrol
Vessel (OPV) and four v24meter Fast Patrol Craft. This is under the Philippine
Ports and Coast Guard Capability Development Project that will enhance the PCG’s
response capability particularly during search and rescue operation, rescue and
salvage work, environmental protection, enforcement of applicable maritime laws,
transport of goods and persons in times of calamities and disasters and support in
the socioeconomic development of national and local government units. The
construction of 24-meter vessels is on-going.
E. Transfer to Clark
The DOTr Central Office has moved to its new home in Clark City, Pampanga in a bid to
jumpstart efforts to decongest Metro Manila. Secretary Tugade, DOTr officials, and heads
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of agencies joined the over 100 first batch of employees in the first flag raising ceremony
held on 28 July 2017.
In a message, Secretary Tugade told the employees that while the transfer may not be easy,
it is necessary. As public servants, he reminded the employees that they must be willing to
sacrifice.
The second batch of employees transferred by November, while the rest followed by the
year-end.
The employees were afforded free shuttle services to and from Clark, provision for flexible
time, four-day work week, and availability of affordable food. Employees also get a break
from traffic, get to enjoy fresh air, and work in a relaxed environment. Discussions on
subsidized accommodations are also ongoing. Employees were also allowed to transfer to
other offices and attached agencies without diminution in rank or service.
DOTr’s transfer to Clark is in line with plans to build a National Government Center in the
city to house central offices of government agencies in one location for more convenient
transactions. As envisioned in the BUILD BUILD BUILD Program of the Duterte
Administration, this shall serve as a common location that will facilitate smooth sailing
convergence of government agencies in terms of coordinating and implementing its
programs and services.
F. Generating Revenue for the Government
Revenue-generating agencies and offices under the DOTr have remitted a total of
PhP25.78-B to the National Treasury in 2016. Remittances for the first quarter of 2017
amounting to PhP7.095-B have also been turned over to government coffers. The LTO has
so far contributed PhP5.76-B this year, followed by MARINA and OTS with PhP294-M
each.
The Land Transportation Office (LTO) makes up the bulk of remittances with PhP21.35-B
for 2016. It is followed by the: Maritime Industry Authority (PhP1.12-B), Toll Regulatory
Board (PhP934-M), Office of Transport Security (PhP831-M), and the Land Transportation
Franchising and Regulatory Board (PhP689-M).
Income from all agencies has been transmitted to the Bureau of Treasury in full.
Apart from this, three Government-Owned and Controlled Corporations (GOCCs) under
the DOTr were also among the top state-owned companies with the highest dividends
remitted to the Treasury.
The Manila International Airport Authority remitted PhP2.26-B, Civil Aviation Authority
of the Philippines remitted PhP1.98-B, and the Philippine Ports Authority remitted
PhP1.95-B worth of dividends for a total of PhP6.2-B, almost half of the total PhP14.02-B
transmitted by GOCCs in May.
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G. Promoting Transparency and Accountability
The DOTr was recognized as one of the top performing departments/national agencies
during the Freedom of Information (FOI) first anniversary and awarding ceremony.
As of 01 December 2017, the DOTr has received 175 requests for information, making it
the third most requested government agency in the FOI portal. 166 requests have been
successfully processed, while nine more are still being processed.
The DOTr was also

recognized for being
the first government
agency to enroll all its
attached agencies and
offices into the FOI
portal.
The DOTr has been

hailed fully compliant
with EO No. 2 or the
implementation of FOI in the executive branch.
Livestreaming of Bidding Processes
Upon the directive of Secretary Arthur Tugade, bidding and procurement processes for DOTr
projects are now being livestreamed in the agency’s Facebook page. The move is seen to
promote transparency in government.
From 29 May 2017 to 8 December 2017, a total of 42 livestreaming posts had been streamed
on DOTr’s official Facebook page. These posts consisted of 98 projects: pre-bidding (48
projects) and opening of bids (50 projects).
H. Communicating Through Digital Media
As of 12 December 2017, the DOTr’s official Facebook gathered 146,316 likes and
148,971 followers. This is a 360% increase from the 31 December 2016 data. The (Net)
page reach is at 5,760,777, while (Net) page views is 22,400.
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The PUVMP post, PILI NA: Saan ka, kaibigan? Sa Siksikan o yung may PLENTY OF
SPACE FOR EVRYONE inforgraphics, gathered the highest people reach with 4,293,907.
It also has the highest engagements (reactions, comments, and shares) with 182,703.This is
followed by the PUVMP Fast Facts infographics with 4,083,046 people reach; and 83,232
engagements.
The DOTr’s official Twitter account has 144, 920 followers as of 12 December 2017 and
1,120,000 (Net) impressions.
Heightened and Tightened Transportation Security
As of October 2017, the Office for Transportation Security (OTS) was responsible for
issuing 32 alert advisories for an intensive and extensive coverage of threat environment;
trained and certified 1,022 personnel for aviation and maritime security; and manned 178
security checkpoints.
The Security Screening Officers stationed on the airport nationwide were able to intercept
the following prohibited items:
Moreover, the evolving levels of threat affecting transport security pushed the OTS
continues to develop policies and programs that is needed to improve safety and security
on public transportation. As of 2017, the OTS was able to draft and issue 10 Memorandum
Circulars concerning transportation security; one Executive Order and its Implementing
Rules and Regulations, two Standard Operating Procedures (SOPs), and among other
policy guidelines. The OTS also drafted the Philippine Transportation Security Act of 2016,
which was already transmitted to the lawmakers on January 2017; reviewed the proposed
Bill on Bomb Threat; conducted consultation meetings for the revision of National Security
Program for Sea Transport and Maritime Infrastructure; and revised the National Security
Program for Land Transportation, Rail System and Infrastructure (NSPLTRSI).
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DEPARTMENT OF AGRICULTURE (DA)
Strategic Goals for the Agriculture and Fishing Sectors for 2017-2022
Agriculture plays a critical role in the Philippines’ economy. Ten percent of the population is
engaged in agriculture and related activities, and the sector contributes 9 percent to the
country’s Gross Value Added (Source: PSA).
Given the importance of the agriculture sector, the Philippine government, under a new helm,
committed to take vital steps for its sustainable development and promotion.
 Sustained productivity growth

o Prioritize crops of comparative advantage as guided by the national color-coded
agriculture and fisheries map
o Intensive technology updating, sharing, modernization, and mechanization program
o Accelerate construction of climate-resilient, small-scale irrigation systems, and retrofit
existing one
o Raise investment in R&D, technology development o Strengthen the extension system
o Pursue an ecosystems approach to fisheries management
 Increased access of farmers/ fisherfolk to value chain

o Diversify into commodities with high value-adding and market potential
o Physically link production areas to market through land, water transport, and logistic
systems and infrastructure
o Organize small farmers and fisherfolk into formal groups to create economies of scale
o Provide capacity building for small farmers and fisherfolk on value-adding activities
o Enhance rate of compliance to regulatory standards
 More accessible financing to small farm

o Provide small farmers and fisherfolk easy access to affordable formal credit
o Increase the number of small farmers and fisherfolk provided with agricultural
insurance
Building a Sound and Sustainable Agriculture and Fisheries Program
2017 marks the first full year of the new administration whose priorities for the country’s
agriculture and fishery sectors are firmly anchored on providing the much-needed support for
farmers and fisherfolk in order to produce sufficient and affordable food for the nation.
The Department of Agriculture has begun to lay down the groundwork as early as 2016 in
support of this goal and continues to adopt strategies that have worked well in the past.
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DA – Annual Accomplishments for CY 2017
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Highlights of Accomplishments by Major Final Output
The agriculture sector’s outcome statements for the medium term, as affirmed in the updated
Philippine Development Plan 2017-2022, consist of improving agricultural and fishery
productivity and increasing agriculture and fishery–based enterprises. In support of this and to
ensure the sustainability of interventions that improve economic opportunities among farmers
and fisherfolk, the DA allocated its budget to eight Major Final Outputs or MFOs: Agriculture
and Fishery Policy Services; Technical and Support Services; Farm-to-Market Road Network
Services; Agricultural Equipment and Facilities Support Services; Irrigation Network Services;
Plant and Animal Regulation Services; and Credit Facilitation Services (Figure 2).
MFOs are goods and services that the DA is mandated to deliver to external clients through the
implementation of agency programs, activities, and projects.
Technical and Support Services

Included in the government’s strategies to improve
agriculture and fishery productivity are the vigorous
promotion of the latest production technologies
(such as the utilization of high-yielding seed
varieties), expansion into new and innovative
marketing scheme, strengthening of the extension
system, and the pursuit of relevant research that will
contribute to better income or livelihood
opportunities.
In 2017, the DA provided technical and support
services to a total of 1.24 million hectares of various
crops (Table 8). Including the livestock sector, about
654,091 individuals and 15,498 farmer groups/ associations and Local Government Units
(LGUs) were provided with assistance on production, marketing, and extension/ training.
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Farm-to-Market Road Network Services
Farm-to-Market Roads (FMR) are essential in the value chain for the promotion of agriculture-
related activities and the efficient transport of agricultural produce within and outside
production areas, contributing to the increase in farm incomes due to reduced transport costs
and postharvest losses. The construction and rehabilitation or repair of FMRs located within
key production areas continue to be coordinated by the DA with the Department of Public
Works and Highways (DPWH), including the identification of priority sites.
From 2014 to 2017, a total of Php 44.27 billion was allocated for FMRs under the Farm-
toMarket Road Development Program (FMRDP). As of 2017, 3,044 kilometers of concrete
and climate-resilient roads have been built (Table10).
FMR construction is also a component of several special projects. For instance, under Locally-
Funded Projects (LFPs), total constructed FMRs as of 2017 has reached 391.70 kilometers;
while Foreign-Assisted Projects (FAPs) have built an estimated 1,887.28 kilometers as of
December 2017.
Agricultural Equipment and Facilities Support Services
Improving agricultural productivity goes hand-in-hand with raising the level of farm
mechanization. This is one of the major endeavors of the DA so that Philippine agriculture
attains competitiveness comparable to those among our Asian neighbors.
The enactment of RA 10601 in 2013, known as the Agriculture and Fisheries Mechanization
(AFMech) Law, mandated the Philippine Center for Postharvest Development and
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Mechanization (PHilMech) to
coordinate, plan, and execute
agricultural and fishery
mechanization and postharvest
research, development, and
extension programs and projects.
The AFMech Law also declares the
policy of the State to promote local
assembling and manufacturing of
engines, machinery, and equipment
for agricultural and fisheries
production, processing, and marketing. This is in response to the tendency of the country to
import its machinery needs, most of which were then found to be incompatible or not well
adapted to local conditions (i.e., small farm size). In addition to high cost of acquisition, some
of these imported machineries entail significant maintenance expenses.
For the year, DA provided and

turned-over farm production-
related and postharvest
machinery, equipment, and
facilities to more than 7,000
farmer groups/ associations and
387 individual farmers. A total
of 6,586 units of production
machinery and equipment,
19,057 units of postharvest machinery and equipment, 352 production facilities, and 339
postharvest facilities were distributed/ turned-over to these recipients.
Reducing postharvest losses in fish catch is also a core focus of the BFAR, as this affects 20-
40 percent of catch volume, which, in turn, reduces both the monetary and nutritional value, as
well as safety of fish for consumption. For 2017, 1,196 units of postharvest equipment were
distributed to 946 fisherfolk individuals and 190 associations/ groups.
Meanwhile, 25 units of Community Fish Landing Centers (CFLCs) have been completed in
2017 as part of BFAR’s Targeted Actions to Reduce Poverty and Generate Economic
Transformation in the Fisheries Sector (TARGET) Program. To date, 293 units of CFLCs have
been constructed (comprising 40 percent of the 725 units approved for implementation from
FY 2015 to 2017); of these, 214 units were already turned-over to LGUs.
Currently, PFDA manages eight fish port complexes in Navotas, Sual, Lucena, Camaligan,
Iloilo, Davao, Zamboanga, and General Santos. The biggest among these are the Navotas Fish
Port Complex (the premier fish center of the Philippines and one of the largest in Asia) and the
General Santos Fish Port Complex (the operations of which was considered of great importance
in the East Asia Growth Area for being the major fishing postharvest infrastructure in the
Mindanao area). In 2017, the total volume of fish unloaded at these complexes reached 402,439
MT. More than 50 percent of this was handled by the General Santos Fish Port Complex,
followed by the Navotas Fish Port Complex (31 percent).
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Meanwhile, the Municipal Fish Port Program caters to the postharvest requirement of
sustenance fisherfolk. It entails the provision of smaller fish landings and market facilities in
selected fishing communities nationwide, some of which act as satellite ports for the regional
fish ports.. To date, PFDA constructed 117 fish ports nationwide. The only fish port jointly
managed by PFDA and an LGU is the Tacloban City Fish Port in Leyte.
Irrigation Network Services
Irrigation is undeniably vital in any agricultural system. Sufficient water increases productivity
while also providing stability in production particularly during the dry season as well as other
extreme weather conditions. The DA continues the implementation of small-scale irrigation
projects (SSIPs) through its RFOs and the BSWM. SSIPs provide not only supplemental
irrigation for improved farm productivity in areas where large-scale irrigation systems are non-
existent, but these also serve as source of Small water for fishery and livestock production, for
recharge of groundwater that contributes to the base flow of our rivers, moderate micro climate,
and to arrest peak flows thereby preventing flash flooding downstream. From January to
December 2017, a total of 5,324 SSIPs were installed/ constructed which generated an
estimated 19,121 hectares of new service area.
Of this total area, 25 percent is located in

Central Luzon, most of which, in turn, were
generated for the benefit of its rice farmers.
Meanwhile, 18 percent of the total service
area generated was from the SSIPs installed/
constructed in Cagayan Valley for use of corn/
cassava farmers as well as vegetable growers.
The SSIPs installed/ constructed across the regions for the year include 39 units of diversion
dams (DDs), 9 units of ram pumps, 2.621 units of shallow tube wells, 52 units of small farm
reservoirs, 5 small water impounding projects (SWIPs), 75 spring development, and 20 units
of wind pumps. There were also 49 SSIPs rehabilitated comprising of 15 units of DDs, 13 units
of SWIPs, and 21 units of drilling rig and irrigation canal.
Agricultural and Fishery Regulation Services
To ensure consumer safety and to promote a competitive agricultural and fisheries sector, the
processing, preservation, packaging, labeling, importation, exportation, distribution and
advertising of fresh, primary, and secondary-processed agricultural and fisheries products must
adhere to quality standards. Under DA’s Bureau of Agricultural and Fisheries Standards
(BAFS), standards are formulated and enforced, as well as harmonized with internationally-
accepted standards and practices.
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From 2003 to 2016, BAFS developed

188 Philippine National Standards
(PNS) covering fresh, primary, and
postharvest agricultural and fisheries
commodities; as well as agricultural and
fisheries machinery, tools, and
equipment. On the average, about 14
PNS have been developed yearly within
that period. For 2017 alone, however,
BAFS was able to develop 45 standards
for agricultural and fisheries
commodities, machinery, and equipment. This significant increase in the number of standards
developed was due to the creation of a BAFS roadmap for its work priorities, specifically, a
Quality Procedure for Standards Development. For 2018, the Bureau targets to develop 43 PNS
(22 Food Safety-related and 21 Quality-related).
DA’s regulatory agencies – the

Bureau of Animal Industry (BAI),
National Meat Inspection Service
(NMIS), Bureau of Plant Industry
(BPI), and the Bureau of Fisheries
and Aquatic Resources (BFAR) –
continue to carry out critical
services to ensure food safety from
the production process, up to its processing, labeling, distribution, and sale, including those
that enter the country. Regulatory activities are likewise being undertaken to comply with
international standards and regulations of trading partners.
Credit, Insurance, and Guarantee
Credit
Availability, accessibility, and affordability of credit for marginal farmers and fisherfolk are
the end-results of the Agricultural Credit Policy Council’s (ACPC) services. Thus, in fulfilling
these commitments, the ACPC continued to implement its credit programs while also designing
two new ones, namely, the Production Loan Easy Access (PLEA) and the Survival and
Recovery Assistance (SURE).
PLEA is an easy access credit program focused towards providing fast, convenient, and
affordable credit to marginal farmers and fisherfolk in the poorest provinces and indigenous
areas unserved by lending institutions and do not have any access to formal credit services.
The program provides non-collateral loans for agri-fishery production at 6 percent annual
interest rate payable in 210 years, depending on the project.
In order to reach more small farmers and fisherfolk, the Program taps grassroots and resident
financial and non-financial organizations such as cooperatives, cooperative banks, farmer/
fisher associations, and NGOs as lending conduits. As of the end of 2017, PLEA has 84 lending
conduits and counting. Within the year, a total of Php768.70 million in loans was released to
28,708 farmers and fisher borrowers.
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On the other hand, SURE was designed to be a quick-response, post-disaster survival and
recovery loan assistance aimed at supporting the immediate rehabilitation of agricultural and
livelihood activities of small farmers and fisherfolk affected by natural calamities and
adversities. The Recovery Loan Assistance component is payable in three years at zero interest
rate to allow the farmer/ fisher to recover losses. It was allocated an initial program fund of
Php 100 million from the Agro Industry Modernization Credit and Financing Program
(AMCFP).
For the year, six credit programs

released a total of Php 3,558.68
million in loans to 69,253 farmer
and fisher-borrowers: PLEA,
SURE, Agriculture and Fishery
Financing Program (AFFP), Sikat
Saka Program (SSP), Agrarian
Production Credit Program (APCP),
and the Cooperative Bank Agri-
Lending Program (CBAP). AFFP,
SSP, and APCP were implemented
through the Land Bank of the
Philippines, while CBAP was
implemented through cooperative
banks. Table 12 summarizes the accomplishments of these programs in 2017 by Island group
and region.
Insurance
The vulnerability of the country to natural disasters continues to pose great risks to agricultural
producers. Thus, the government upholds the provision of insurance to farmers and fisherfolk
as a priority intervention. This unwavering support, as well as increasing public appreciation
for insurance, has enabled the Philippine Crop Insurance Corporation (PCIC) to sustain its
tremendous growth in carrying out its functions, as shown by the improvements in the agency’s
accomplishments from 2016 in Table 13:
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Guarantee
Access to credit from formal lenders has been a long time concern for small-scale farmers and
fisherfolk. Most of the farmers do not own the land that they till while most lending institutions
require collateral prior to granting of the loan.
One of the government programs that can help farmers and fisherfolk access credit from formal
lenders is the Agricultural Guarantee Fund Pool (AGFP), a DA-led program with the Land
Bank of the Philippines as the Program Institutional Manager. AGFP encourages lending
institutions to extend unsecured agricultural food production loans to small farmers and
fisherfolk by mitigating the risks in agri-lending through the provision of the guarantee. This
will help flow the credit to the agriculture and fishery sector. AGFP covers production loans
extended for short-gestating crops/commodities such as palay, corn, livestock, and fishery.
AGFP has been in partnership with various lending institutions throughout the country. For
2017, AGFP was able to guarantee Php6.7 billion loans (Table 14), with paid guarantee claims
amounting to Php312 million. The greatest beneficiaries of the AGFP are the small farmers
and fisherfolk
who would have
not been able to
borrow without
the guarantee.
This year, 76,031
small farmers and
fisherfolk were
covered by the
guarantee.
Agriculture and Fishery Policy Services
Building a competitive agriculture and fishery sector also necessitates having a sound policy
environment that will contribute to raising the quality of life and promoting food security. The
DA’s Policy Research Service (PRS) leads the analysis and review of options for the resolution
of policy issues, as well as provision of technical assistance in various priority legislative
agenda of the DA for the benefit of the sector. Meanwhile, the Philippine Council for
Agriculture and Fisheries (PCAF) assists in the preparation of policy recommendations and
resolutions adopted by various National Sectoral and Strategic Concerns Committees
(NSSCCs) on commercial crops, poultry and livestock, and agricultural and fishery
machineries and equipment.
Some of the accomplishments related to these are as follows:

 Provided technical support in the crafting of the draft bill amending RA 8178 or the
Agricultural Tariffication Act in order to tariffy imported rice at rates and terms that will
benefit rice farmers. This is in response to the expiration on June 30, 2017 of the waiver
granting the Philippines special treatment on rice by the World Trade Organization (WTO),
and the corresponding need to amend RA 8178 to remove the quantitative restriction on
rice.
 Assisted the Committee on Commercial Crops in the adoption of Resolution No. 15 Series
of 2017 Recommending to the Senate Committee on Ways and Means the exclusion of
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locally-manufactured coffee with sugar in the imposition of excise tax on Sugar-Sweetened

Beverages (SSB) Bill.
 Assisted the Committee on Poultry, Livestock and Feed Crops in the adoption of Resolution
No. 1 Series of 2017 Recommending to the DA Secretary that the validation of Sanitary
and Phytosanitary (SPS) Permits in the poultry, livestock and feed crops products be limited
to meat and meat products which are prone to smuggling.
 Provided comments during the deliberations of the Coco Levy Bill, such as: removing the
cap of five hectares of coconut farm in the definition of a coconut farmer to make it more
inclusive; providing more seats for farmers in the Trust Fund Committee; concurrence with
the House version of the bill to use Php 10 billion of the initial trust principal within two
years to jumpstart the development of the industry, and that the remainder of the trust
principal be preserved and maintained for the benefit of the future generation of coconut
farmers in the industry; and to revisit the draft Coconut Industry Roadmap and to also
include the comments and suggestion of coconut farmers in the finalization of the
document.
 Crafted the Implementing Rules and Regulations for the Customs Modernization and Tariff
Act (CMTA) to monitor the regulatory functions of the DA ensuring food safety, such as
the issuance of Sanitary and Phystosanitary Clearance for agriculture and fisheries products
that enter the country, and the modernization of facilities conducting these tests.
 Concurrence with the Agriculture and Fisheries Enhancement Fund (ACEF) Extension
Law to cover more stakeholders in the granting of loans and scholarships.
 Successfully negotiated at the Senior Officials Meeting of the ASEAN Ministers on

Agriculture and Forestry (SOM-AMAF) consensus for support for the signing of an
ASEAN letter to the US Secretary of Agriculture requesting for the non-delisting of
carrageenan as ingredient in organic foods.
 Strongly lobbied with coconut producers/exported among ASEAN and APEC members,
particularly Brazil, to counter the unhealthy claims of the American Health Association
(AHA) on coconut oil and its byproducts – the Philippines being the biggest producer and
exporter of coconut oil in the world.
Focused Interventions to Effect Positive Changes
The Department’s Service Units (Bureaus, Attached Agencies, and Attached Corporations)
perform critical functions in support to the interventions being provided by the Regional Field
Offices, as well as specific services not covered by the mandates of the RFOs.
Operating
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Department of Environment
and Natural Resources
DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES (DENR)
The year 2017 marked the reign of two Secretaries in the Department: Secretary Regina Paz L.
Lopez and Secretary Roy A. Cimatu who assumed his post in May 10, 2017.
Several programs were vigorously pursued under both leadership anchored on the 6-year action
program of President Rodrigo Duterte known as “Program for Environment and Natural
Resources for Restoration, Rehabilitation and Development (PRRD).”
The PRRD adopts five priority programs to address ENR issues and pursue the thrusts of the
Duterte administration: (1) Social Justice in Land Titling; (2) Good and Effective Governance
in Environmental Protection; (3) Restoration of Forest and Protected Areas; (4) Adaptation to
Climate Change and Sustainable Use of Natural Resources; and (5) Conservation of Coastal
and Marine Resources.
To operationalize the PRRD, the DENR implemented the following programs anchored on the
core principles of Good and Effective Governance, Inclusive Growth, and Social Justice: Clean
Air; Clean Water; Solid Waste Management; Geohazard, Groundwater Assessment and
Responsible Mining; Forest and Watershed Management: E-NGP; Forest Protection and Anti-
Illegal Logging; Enhanced Biodiversity Conservation; Coastal and Marine Ecosystems
Management; Improved Land Administration and Management; Responsive ENR Research
and Development; and Climate Change Resiliency, Adaptation and Mitigation.
The Report shows that for 2017, we met and even exceeded our targets, notably on the National
Greening Program (NGP), which has the total area planted of 202,488 hectares or 106% of the
annual target with 178,142,764 seedlings planted. On mines and geosciences, coastal and
marine resources management, as well as, on the environment sector, all activities marked
above 100% accomplishment. On land sector, a total of 28,705 agricultural and 42,196
residential free patents were issued out of the targeted 32,151 and 46,355 patents, respectively.
MAJOR ACCOMPLISHMENTS
A. Policies/Guidelines/Technical Bulletins (TB) Formulated and Approved
On Environmental Protection:
1. Online Transmission of Data from Continuous Emission Monitoring System
(CEMS) and Closed Circuit Television (CCTV) of Major Industries (DAO 2017-
14)
2. Guidelines on Public Participation under the Philippine Environment Impact
Statement (EIS) System (DAO 2017-15)
3. EMB Manual of Uniform Procedures (MC 2017-002)
4. Site Characterization Guidelines (MC 2017-003)
5. Site Remediation Guidelines (MC 2017-004)
6. Clarification on the Coverage of Laboratory Facilities under the Requirements of
DENR Administrative Order No. 2007-23 (Prescribing Additional Requirements
for the Issuance of Priority Chemical List Compliance Certificate) (MC 2017-007)
7. Clarification on Permitting Regulations for Small Quantity Importation (SQI), Pre-

Manufacture Pre-Importation Notification (PMPIN), Priority Chemical List (PCL)
And Chemical Control Order (CCO) (MC 2017-009)
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DENR – Annual Accomplishments for CY 2017
8. Guidelines in the Implementation of Globally Harmonized System (GHS)

Classification and Labelling Requirements for High Volume Chemicals (HVCs)
(MC 2017-010)
On Research and Development:

a. Adoption of the Manual for the Establishment, Management and Maintenance
of Philippine Bambusetum
b. Guidelines on the Integrated Management of Bamboo Resources
c. Implementation of the Bamboo Plantation Development Project
d. Turn-over of Clonal Nurseries and Seed Sources
e. Adoption of ERDB-BMB Joint Technical Bulletin on Guidelines on
Enrichment Planting of Mangroves and Beach Forest for Biodiversity
Conservation and Coastal Resiliency
f. Revised Guidelines and Procedures in the Management of DENR Research,
Development and Extension Systems
g. Adoption of the Field Manual for Tree Seed Collection, Processing and
Certification and Production of Quality Planting Materials and Revising DENR
Administrative Order 2010-11
h. Guidelines for Environmental Risk and Impact Assessment of Genetically-
Modified Plant and Plant Products Derived from Modern Biotechnology
On Forest Resources Management:
a. FMB TB No.22-A – Growing Media for Mechanized Container Tree Nursery
b. FMB TB No. 22-B – Seedling Nutrition and Fertilization for Container Tree
Seedlings
c. FMB TB No. 22-C – Design and Layout of Mechanized Container Tree Nursery
d. FMB TB No. 22-D – Introduction to Mechanized Container Tree Nursery
Management and Crop Planning
e. FMB TB No. 22-E – Crop Recording for the Development of Propagation
Protocols
f. FMB TB No. 22-F – Integrated Pest Management
g. FMB TB No. 22-G – Operating and Maintenance Procedures for the Seedling
h. FMB TB No. 22-H – Guidance in the Watering of Container Tree Seedlings
under the MMFN
i. FMB TB No. 22-I – Key Success Factors with Seed Germination
j. FMB TB No. 22-J – Proper Use and Handling of Plastic Seeding Trays
On Land Management:
a. DENR Memorandum Order No. 2017-02 dated August 16, 2017 entitled
“Amending DENR Memorandum Order No. 2011-04 on the Strict Regulation
of Activities, Projects and Land Uses in All Areas Proposed for inclusion in the
National Integrated Protected Areas System (NIPAS)”
b. Lands Memorandum Circular (LMC) No. 2017-002 dated September 25, 2017
entitled “Addendum to Item D, Section 196 of DENR Memorandum Circular
(DMC) No. 2010-13, as amended, or the “Adoption of the Manual on Land
Survey Procedures”
c. Lands Memorandum Circular (LMC) No. 2017-003 dated December 27, 2017
entitled “Adoption on the Alternative use of Unmanned Aerial Systems (UAS)
in the Conduct of Land Surveys”
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d. LMB Technical Bulletin No. 2 series of 2017 entitled “Guidelines on the Use
of Unmanned Aerial Systems (UAS) in Support of Land Surveys.” This serves
as the supplemental issuance to LMC No. 2017-003 which provides for the
technical procedures on the use of drones.
e. Lands Memorandum Circular (LMC) No. 2017-001 dated February 15, 2017
entitled “Establishment of a National Coordinating Office and a Monitoring
Team for the Survey Records Reconstruction Activity”
f. DENR Memorandum Circular (DMC) No. 2017-04 dated May 2, 2017 entitled
“Addendum to Sections 5.1 and 6.2.1 of DMC No. 2010-06 or the Manual of
Procedures on the Transformation and Integration of Cadastral Data into the
Philippine Reference System of 1992 (PRS’92)”
g. DENR Memorandum Circular (DMC) No. 2017-05 dated May 2, 2017 entitled
“Verification, Approval and Data Capture of On-going or Newly Submitted
Survey Plans and Public Land Applications (PLAs) under the LAMS”
h. DENR-NCIP Joint Administrative Order No. 2017-01 dated September 5, 2017
entitled “Procedures for Securing Titles under Section 12 of the Indigenous
Peoples Rights Act (IPRA) of 1997 (RA 8371)”
i. DENR Memorandum Circular No. 2017-11 dated December 5, 2015 entitled
“Amending DMC No. 2010-06 or the Manual of Procedures on the
Transformation and Integration of Cadastral Data into the Philippine Reference
System of 1992 (PRS’92)”
B. Major Programs Implemented
1. Enhanced National Greening Program
In an effort to rehabilitate the remaining 7.1 million hectares of unproductive,

denuded, and degraded forestlands from 2016 to 2028, the Expanded and Enhanced
NGP was vigorously pursued.
In 2017, the program added 202,488 hectares of plantations, or 106 % of the annual
target, utilizing 178,142,764 seedlings. This brings to 1,864,717 hectares the total
NGP-covered areas as of December 31, 2017, generating 4,603,147 jobs benefitting
642,638 individuals from local communities and People’s Organizations.
A total of 187,771,446 million seedlings were produced which is 7% higher than

the target of 174,303,381 seedlings. The excess numbers of seedlings will be used
for replacing mortalities in the succeeding years.
To develop the knowledge, skills and appreciation in community of Forest

Extension Officers, a learning event on Community Organizing and Rural
Development, entitled “Advancing the ENGP through Community Organizing: A
Revalidate, Reorientation and Training” was conducted and participated in by 1,704
Extension Officers and 337 NGP Coordinators nationwide.
The monitoring, evaluation and validation of established NGP sites/plantations is

regularly conducted. For 2017, a total of 298 sites were validated.
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The different reforestation programs that are harmonized under NGP were also
regularly monitored and evaluated, such as the PAyapa at MAsaganang
PamayaNAn (PAMANA), Barangay Stratreegic Forest Project, Arboretum, Balik
Probinsiya Program, and Sajahatra Bangsamoro Program.
To ensure the massive production of quality seedlings, five (5), out of the targeted
11 Mechanized and Modernized Forest Nurseries (MMFN), are already operational.
These are located in NCR, Regions 2, 5 (Camarines Sur), 7, and 13. The
development of the remaining six (6) MMFNs, located in Regions 3, 4A, 5 (Albay),
6, 9 and 12, are still ongoing.
The construction of MMFNs in Regions 4A, 5 and 9 are already finished, awaiting
the installation, testing, commissioning and acceptance of the equipment. The
MMFN in Region 3 is already completed and the equipment was already tested,
installed and commissioned and is now awaiting the approval of the Certificate of
Project Completion and Certificate of Acceptance to be signed by duly authorized
DENR and Philippine International Trading Corporation (PITC) representatives.
The construction of MMFN structures/facilities in Region 6 is ongoing while the
MMFN in Region 12 is now for Awarding of Contract.
2. Forest Protection and Anti-Illegal Logging
The DENR confiscated a total of 2.1 M bd ft of illegally cut, processed logs and
forest products nationwide with the support of law enforcement agencies and
strengthened Regional Anti-Illegal Logging Task Force. A total of 222 cases were
filed in court against the violators, with 16 individuals convicted. This brings the
total confiscated forest products to 38.4 M bd ft, 2,361 cases filed and 230 convicted
individuals for the period CY 2011‒2017.
To ensure that the patrol works are regularly conducted, a total of 1,897 forest
protection officers were hired. This includes 1,458 hired using Central Office-based
funds. In addition, a total of 61 forest ranger stations/look-out towers were also
constructed. Procurement and purchase of logistics and material support essential
in forest law enforcement were also undertaken. These include fire prevention and
fighting equipment, geotagging and personal protective equipment.
In order to protect the DENR Forest Officers and Forest Rangers in the performance
of their duties and responsibilities in forest protection, the DENR procured security
services of an accredited security agency to accompany forest protection patrollers
in the conduct of patrolling and in responding to environmental threats, pursuant to
RA 9184 (Government Procurement Act of 2002).
The Department also adopted and implemented the Lawin Forest and Biodiversity
Protection System or “Lawin” as a strategy to protect the forest and biodiversity.
The Lawin system uses open-source technology for biodiversity and threats
monitoring through a smartphone app for electronic encoding of field data and an
open-source software for geospatial analysis of collected data in forest ecosystem.
There was a joint venture with the FMB, USAID B+WISER and World
Conservation Society (WCS) to develop the Lawin SMART Connect. The Lawin
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SMART Connect centralized the consolidation of patrol data by establishing a cloud

database allowing simultaneous access to Lawin patrol data and analysis thru
dashboards and reports to aid in decision-making by different levels of management
at the DENR. This SMART Connect was successfully deployed in 167
Conservation Areas through a series of capacity building workshops.
For the Lawin to be institutionalized as a national strategy for forest protection, the
FMB drafted a Department Administrative Order and Manuals that shall provide
guidance in implementing the Lawin System.
The Lawin System received one of five Digital Development Awards (Digis) as
part of USAID’s Global Innovation Week hosted in Washington DC. The system,
along with four other winners, was selected out of more than 100 entries from
around the world. The Digis Award recognizes projects that embrace cutting-edge
technologies and novel approaches that accelerate development impact.
The commonly observed threats during Lawin patrolling include occurrence of

pests and diseases, landslides and mudslides, presence of invasive species, fire,
infrastructures, garbage, cutting of trees, typhoon-related threats, slash and burn
farming, annual and perennial farming and charcoal making.
3. Clean Air
The DENR, through the EMB, collects real-time air quality data from ninety eight
(98) stations that are capable of measuring Sulphur Dioxide, Nitrogen Dioxide,
Ozone, Carbon Monoxide, Benzene, Toluene and Xylene as well as meteorological
data to strengthen the monitoring of air pollutants in Metro Manila and other urban
centers nationwide. The EMB also safeguards the accuracy of the data generated by
the stations by conducting periodic maintenance and calibration to all monitoring
stations.
National Air Quality
To ensure that the data gathered by the monitoring stations are complete and
accurate, monthly maintenance and regular calibration is performed. There is a
total of 4 Real Time Air Quality Monitoring stations and one mobile monitoring
station operated, maintained and regularly calibrated by the Ambient Monitoring
Team at the Central Office. For the data gathered from the station, quarterly data
management and QA/QC report are being done to ensure the correctness of the
data reports. With regard to the emission inventory of sources, data have also
been assessed every quarter.
a. Total Suspended Particulate (TSP)
The country’s air quality still exceeds the DENR guideline value of 90 µg/Ncm.
Despite the efforts to increase compliance of both stationary and mobile sources
with the standards and policies set forth under the Clean Air Act, the
exceedances in annual Total Suspended Particulates (TSP) may be influenced
by many complex factors like the heavy traffic in Metro Manila during rush
hours including the construction works occurring near the monitoring site.
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Figure 5. Nationwide Air Quality Status (TSP)
Figure 6. Metro Manila Air Quality Status (TSP)
b. Particulate Matter (PM10)
To determine emissions of fine particulates such as Particulate Matter (PM10)

which are more harmful, there are twenty two (22) Continuous Ambient Air
Monitoring Stations (CAAMS) installed in Metro Manila composed of thirteen
(13) CAAMS measuring particulate matter 10 (PM10) and Particulate Matter
(PM2.5) and meteorological data; seven (7) CAAMS-DOAS which measure
Particulate Matter 10 (PM10) and 2.5 (PM2.5), Sulfur Dioxide (SO2), Nitrogen
Dioxide (NO2), Photochemical Oxidants as Ozone (O3), Carbon Monoxide
(CO), Meteorological Data and other gases such as Benzene, Xylene and
Toluene; and two (2) CAAMS Conventional which monitor Particulate Matter
10 (PM10) and 2.5 (PM2.5), Sulfur Dioxide (SO2), Nitrogen Dioxide (NO2),
Photochemical Oxidants as Ozone (O3), Carbon Monoxide (CO).
The nationwide results of the ambient air monitoring in terms of PM10 decreased
from 76 ug/Ncm in CY 2011 to 41 ug/Ncm in CY 2017. However, there was a
significant increase in CY 2017 compared to CY 2016 which is due to the
volume of vehicles traversing along EDSA and other major thoroughfares in
Metro Manila.
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Figure 7. Nationwide Air Quality Status (PM10)
Figure 8. Metro Manila Air Quality Status (PM10)

Motor Vehicle Emission Management Program
The Motor Vehicle Emission

Management Program
(MVEMP) manages emission
from mobile sources. In order to
effectively carry out the
management of emission from
this source, activities were
divided into two major parts:
one for the brand new motor Figure 9. The conduct of vehicle emission testing
vehicle, and another for the in-
use motor vehicles.
Pursuant to Section 22 of the Clean Air Act, all imported new or locally-assembled
new motor vehicles shall secure a Certificate of Conformity (COC) issued by the
Department of Environment and Natural Resources through the Environmental
Management Bureau before they can be registered. This is to ensure that the vehicle
complies with the emission standard set pursuant to Clean Air Act. There are 504
COCs issued for CY 2017. The COCs are all processed and issued through Online
Permitting and Monitoring System (OPMS).
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DATE MOTOR VEHICLE MOTORCYCLE TOTAL

JAN 16 11 27
FEB 5 8 13
MAR 31 17 48
APR 15 6 21
MAY 15 10 25
JUN 38 26 64
JUL 16 5 21
AUG 27 21 48
SEP 40 4 44
OCT 76 24 100
NOV 60 13 73
DEC 16 4 20
TOTAL 355 149 504
Table 3. List of 504 COCs issued in CY 2017
Garage Testing
Garage Testing successfully engaged the cooperation of Metro Manila bus

operators and public utility jeepneys (PUJs). Assistance provided by this program
includes free emission testing, information and education campaign (IEC) on fuel
efficiency and management and regular vehicle maintenance. Out of 6,068 vehicles
tested, 2,924 passed while 3,144 failed the vehicle emission standard.
NO. OF
MONTH VEHICLES RESULT TYPE OF VEHICLE GARAGE
TESTED
PASSED FAILED BUS PUJ UV
January
February 158 50 108 158 6
March 952 501 451 905 20 22
April 665 458 207 292 302 14
May 423 235 188 14 409 13
June 316 147 169 39 259 11
July 202 89 113 29 173 8
August 616 247 369 15 488 83 21
September 468 212 256 52 381 17
October 697 371 326 669 22
November 1,085 392 693 24 1,061 33
December 486 222 264 76 410 12
TOTAL 6,068 2,924 3,144 541 5,215 103 179
Table 4. Garage Testing Result in CY 2017
Industrial Emission Management Program
The Industrial Emission Management Program (IEMP) ensures compliance of

industries to the emission standards set by the EMB. Thus, issuance of permit and
regular monitoring is done. With the increasing number of stationary sources,
extensive monitoring is required. In order to monitor all sources with potential to
emit air pollution, the Bureau accredits Third party source emission testing firms
(TPSETF) to carry out source emission test and effectively perform sampling
activities in accordance with the provisions of CAA and its Implementing Rules and
Regulations.
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The stack emission testing activities are done to ensure the compliance of stationary
sources to the standards set forth by Republic Act 8749. With the limited number
of EMB personnel to perform stack emission testing, the bureau accredits firms
which can conduct the said tests. For the year, twenty one (21) firms were accredited
by EMB with a total of forty (40) teams. A total of 15,838 firms were monitored,
or 115% of the target.
To ensure that the testing firms follow the guidelines on proper testing procedure,
the Bureau has created its own Sampling Assessment Team (SAT) consisting of
technical personnel from the EMB Central office thru the Air Quality Management
section (AQMS) who conducts random monitoring and observation of the 3rd
party’s performance. For the year, a total of 19 stack emission tests monitoring were
accomplished by AQMS SAT Team within Metro Manila, Region 3 and Region
4A. Aside from the manual stack testing, SAT also conducted three (3) observations
of RATA/ RAA/ CGA.
General Ambient and Roadside Ambient Air Quality Monitoring Program
The General Ambient and Roadside Ambient Air Quality Monitoring Program
ensures that the ambient air quality monitoring stations are operated, maintained
and calibrated. The manual and real time stations are situated in highly urbanized
cities nationwide and being managed by each regional offices’ focal and alternate
focal persons. The said focal and alternate focal persons are created through EMB
Special Order No. 219 Series of 2015. They are tasked to oversee day to day
operation of the stations located in their respective terrestrial jurisdiction and submit
a quarterly report of the stations’ operation. The AQMS central office manages the
central depository system and acts as the overall section in charge of the operation
and maintenance of the 98 stations nationwide.
Air Quality Monitoring Stations

TYPE OF STATIONS NO. OF STATIONS
CAAQMS-DOAS 20
CAAQMS-PMS 25
CAAQMS-Conventional 4
Manual 49
Total 98
Note: DOAS- Differential Optical Absorption Spectroscopy
PMS- Particulate Matte System
CAAQMS-Continuous Ambient Air Quality Monitoring Station
Table 5. List of Air Quality Monitoring Stations
Pursuant to Section 8, Chapter 2 of the Clean Air Act of 1999, twenty two (22)
airsheds were established and operationalized nationwide (See Annex 5). These
airsheds are established in order to oversee the planning and implementation of air
quality management policies and ensure strong coordination among government
agencies and between government agencies and private sector / civil society.
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Promotion of Clean Energy
As part of our partnership with Japan in promoting clean energy, the DENR
received 10 units of electric and hybrid cars from Japanese auto giant Mitsubishi
Motors Corp. (MMC) consisting of 5 units of Mitsubishi Innovative Electric
Vehicle (i-MiEV) and 5 units of Outlander plug-in hybrid vehicles (PHEV). These
will be used by the DENR as service vehicles at its central office in Quezon City
and regional offices in the cities of Cebu and Davao.
Development of Mobile Application for Air Quality
The EMB has fully developed the mobile application that allows mobile phone
users to access simplified air quality information in the form of Air Quality Index.
As of December 2017, the mobile application is for downloading from Google Play
and App Store. The second phase of the system is ongoing, which includes upgrade
on enhanced security features and text blast. The public can expect more of such
initiatives, as the Bureau continues to improve its services to the public.
4. Clean Water
The DENR started massive clean-up and rehabilitation of Malandog River in

Hamtic, Antique as the initial site of the Sustainable River Action (SRAC) Program.
The river was chosen for its socio-cultural and historical importance to the people
of Antique and the whole Panay Island.
Through the Sustainable River Action (SRAC) Program which was set off under
the leadership of Secretary Roy A. Cimatu, there were dynamic improvements in
the water quality of the waterbodies nationwide and these were achieved because
of the collaborative efforts of EMB and the stakeholders as well as the LGUs and
other government agencies. These improvements show that there is also an increase
in the awareness of the people in taking the responsibility in protecting the
environment.
Monitoring of Priority Rivers
Nineteen (19) priority rivers were identified for monitoring. These rivers are seen
to be critical in terms of their water quality. Interventions such as the Adopt-an-
Estero or Adopt-a-Waterbody Program and the designation of Water Quality
Management Areas (WQMAs) are being implemented in order to mitigate water
pollution and improve the water quality of the rivers and waterbodies in the country.
For CY 2017, eight (8) out of nineteen priority rivers passed the water quality
guideline for Dissolved Oxygen (DO). In terms of Biochemical Oxygen Demand
(BOD), five (5) passed the guideline value and these are Salog and Balos River in
Region 5, Luyang and Sapang Daku River of Region 7 and Cagayan De Oro River
in Region 10. Annex 6 shows the results of water quality monitoring of Priority
Rivers.
Adopt-an-Estero Waterbody Program
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For CY 2017, there were 763 signed Memorandum of Agreements and 520
waterbodies adopted.
A total of 12 trucks containing 3,331 sacks and 60 bags or 288,043.20 kilograms of

mixed solid wastes were removed during the clean-up activities. The clean-up was
a collaborative effort of 24,575 individuals from our partner adopters, LGUs and
communities within the adopted waterbodies. Other adopters’ initiatives are:
establishment of MRF and practice of segregation at source by putting segregation
bins in their Offices and area of operations.
Other interventions like reforestation were also conducted by adopters. Bamboo and
other tree species were planted along the strategic areas of their adopted waterways.
In order to mitigate soil erosion and landslide, slope protection such as grouted
riprap and vegetative engineering was introduced to bare and critical slopes along
the river banks.
The progress of the adopted esteros/waterbodies is monitored by EMB and all its
regional office ensuring that the esteros/waterbodies adhere to the following
criteria: improved water quality using DO and BOD as parameters to determine
their compliance with the Water Quality Guidelines and General Effluent Standard
of 2016; reduction of solid wastes and floating debris; engagement, involvement,
and ownership of the program by local community residents; presence of
information and education programs on water quality and solid waste management;
presence of working Materials Recovery Facility or Materials Recovery System;
active engagement of the local government unit, private sector partner, and other
program partners; presence of other physical improvements in the area (i.e.
greening, dredging. Rip-rapping, linear parks, etc.); presence of River Management
Council or equivalent; and presence of livelihood opportunities in the area.
BEFORE AFTER
Figure 11. Spine Creek in Malabon City
BEFORE AFTER
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Figure 12. Manarigo Creek in Las Piñas City
Interim Results of the Adopt-an-Estero/Waterbody Program
Figure 13. Less floating debris on esteros Figure 14. Increased frequency of declogging
(e.g. San Jose Gusu Creek in Zamboanga City) activities (e.g. San Isidro Creek in Davao City)
Figure 15. Quick flooding subsidence (e.g. Arellano Creek in Dagupan City
Water Quality Management Area (WQMA)
The objective of the WQMA is to protect, thru stakeholders’ collaboration, the

water body and its tributaries by keeping their water quality within the Water
Quality Guidelines or Criteria, conforming to the water body’s classification (e.g.,
fishery water or for bathing/swimming). A WQMA Action Plan will be prepared in
order to address water quality issues and problems in the area and later result in the
improvement or better water quality of the said water body.
The management areas shall have similar hydrological, hydrogeological,

meteorological or geographic conditions which affect the physiochemical,
biological and bacteriological reactions and diffusions of pollutants in the water
bodies or otherwise share common interest or face similar development programs,
prospects or problems.
The stakeholders’ participation is very critical in the designation as well as WQMA

operationalization inasmuch as members of the WQMA Governing Board come
from different sectors of the society.
Presently, there are thirty-one (31) officially designated WQMAs, including the
areas within the jurisdiction of LLDA which was designated as one management
area by virtue of the Clean Water Act. (See Annex 7)
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Classification of Waterbodies
Water Classification is arranged in the order of the degree of protection required,

with Class AA and SA having generally the most stringent water quality,
respectively, for fresh surface waters and marine/coastal waters; and Class D and
SD waters have the least stringent water quality for fresh surface waters and marine
waters respectively.
Some water bodies have more than one classification such as Class AA at the
uppermost portion of the river and D at the lowest portion of the river. The same is
true with the marine waters having Class SA in some portion and Class SD in some
other portions. Six (6) rivers has a portion that was classified as Class AA meaning
water which require only disinfection in order to meet the National Standards for
Drinking Water (NSDW) and usually, this is in the upper most portion of the river.
Two hundred fifty four (254) waterbodies have portions that are classified as Class
A or waters which require complete treatment (coagulation, sedimentation,
filtration and disinfection) in order to meet the NSDW. Two hundred eighteen (218)
waterbodies have portions that are classified as Class B or waters that can be used
for primary recreation such as bathing and swimming.
Three hundred fifty (350) have portions that are classified as Class C for fishery
water for the propagation and growth of fish and other aquatic resources and for
agriculture, irrigation and livestock watering and suited for cooling purposes.
Thirty-one (31) have portions that are rated as Class D, navigable waters.
Under the coastal and marine water group, ten (10) water bodies have portions that
are classified as Class SA waters suitable for harvesting of shellfish for direct
human consumption and designated as marine parks and reserves. Fifty-four (54)
have portions that are rated as Class SB or waters suitable for commercial
propagation of shellfish and intended for as spawning areas for milkfish, for
ecotourism and recreational activities and for bathing, swimming and skin diving
while forty-five (45) have portions that are classified as Class SC described as
Recreational Water Class II suited for boating, fishing, or similar activities, for the
propagation and growth of fish and other aquatic resources and intended for
commercial and sustenance fishing. So far, there is no portion of any body of water
that falls under Class SD, navigable waters.
Pursuant to DENR Memorandum Circular No. 2017-13, an additional 30

waterbodies were classified in 2017 in accordance with the Manual of Procedure
for Water Classification following the standards specified in DENR Administrative
Order (DAO No. 2016-08) Water Quality Guidelines and General Effluent
Standards of 2016.
Recreational Waters Monitoring
The DENR, thru the EMB, is also mandated by Section 2 of Republic Act (RA)
9275 or the Philippine Clean Water Act of 2004 to streamline the processes and
procedures in the prevention, control and abatement of pollution of the country’s
water resources as well as to promote public information and education and to
encourage the participation of an informed and active public in water quality
592
management and monitoring. A joint undertaking among EMB and other

government agencies such as Department of Health (DOH), Department of Tourism
(DOT) and LGUs was forged in the identification of tourist recreational areas and
those waterbodies that are intended for primary contact recreation, Class B or SB
waters.
There were 351 recreational water bodies that were monitored for fecal coliform in
2017. Of these, 136 or 39% passed the 100 MPN/100 mL water quality criteria for
SB waters while 215 or 61% failed or exceeded the allowable fecal coliform count.
Annex 8 shows the CY 2017 Water Quality of Recreational Waters in the
Philippines.
Monitoring Water Quality of Manila Bay
a. Monitoring of Bathing Beaches
To determine pathogens contamination of bathing beaches in Manila Bay,

nineteen (19) stations were monitored for fecal coliform count. Data derived
from the monitoring showed that all stations failed to comply with the water
quality guidelines of 100mpn/100ml for fecal coliform. Other parameters such
as DO, pH and total suspended solids (TSS) were also monitored. Fourteen (14)
stations conformed to the DO water quality guidelines of 5mg/L while all
stations passed the criteria for pH. For TSS, nine (9) out of the nineteen (19)
stations passed the guidelines.
b. Baywide Monitoring
Nine (9) stations Baywide in Manila Bay were monitored for DO, pH, Salinity,
Temperature, Conductivity and Total Suspended Solids (TSS). A decreasing
trend of Dissolved Oxygen (DO) from top to bottom was observed in all
stations. Surface DO conformed to the criteria of 5mg/L in all stations while
only 8 stations conformed at mid-depth. For bottom DO, only two (2) stations
passed the DO criteria. For TSS, all stations passed the criteria. High levels of
pH ranging from 8.94 to 9.18 were observed in the bay.
Four (4) trash boats were turned over to the Bulacan provincial government, and
the municipalities of Sto. Tomas, Pampanga and Orion, Bataan for the clean-up
operations of Manila Bay. This is primarily to implement the Department’s
commitment to assist LGUs in cleaning, rehabilitating, and preserving the
country’s most important water bodies. It is in compliance with the mandamus
and to improve water quality and encourage the LGUs to implement solid waste
management. A total of 36 trash-collecting boats were already donated to LGUs
throughout the country. The piles of collected garbage are manually sorted out
before transported to the appropriate disposal facility.
5. Solid Waste Management
The DENR continues to deal with the pressing issues of the R.A 9003 (Ecological
Solid Waste Management Act of 2000) through the engagement of the LGUs and
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their respective residents in the implementation of the activities and providing

support in the establishment of MRFs and in the closure and rehabilitation of
dumpsites. During implementation, LGUs have also provided their utmost support
by providing counterpart funds to finance its activities.
Approval of 10-Year Solid Waste Management Plan
Section 16 of RA 9003 provides that provinces, cities or municipalities, through

their local solid waste management boards, shall prepare their respective 10-Year
solid Waste Management Plans consistent with the National Solid Waste
Management Framework. The Plan shall contain all the components provided in
Section 17 of the Act and a timetable for the implementation of the solid waste
management program. All local government solid waste management plans shall be
subjected to the approval of the National Solid Waste Management Commission
(NSWMC).
Technical assistance in the development/formulation/updating of 10-Year SWM

Plans including conduct of Waste Analysis and Characterization Study (WACS),
plan preparation and pre-WACS orientation was provided.
As of December 2017, a total of 1,469 Solid Waste Management (SWM) Plans were
submitted by the LGUs and a total of 898 plans were approved, out of 994 plans
endorsed for the approval of the Commission.
Support in the Establishment and Monitoring of Materials Recovery Facility (MRF)
The establishment of MRF is a scheme to reduce the amount of garbage being

disposed and the production of GHG (methane) coming from domestic and
commercial biodegradable wastes through the process of composting/vermin-
composting instead of disposing to landfills. Technical support was provided in the
establishment of 10,052 MRFs servicing 13,324 barangays nationwide.
Figure 16. MRFs established and barangays served from 2010 to 2017
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Closure and Rehabilitation of Illegal Dumpsites
Regular monitoring
and technical
assistance are provided
to the LGUs for the
closure of illegal
disposal facilities. For
2017, 333 LGUs were
provided assistance in
the proper closure and
rehabilitation of open
and controlled
dumpsites within
WQMAs and Manila Figure 17. Closed and illegal dumpsites
Bay Region, exceeding the target by 43%. Significant decrease was noted from 511
illegal dumpsites in CY 2016 to 385 in CY 2017. As of December 2017, there are
135 operational Sanitary Landfill nationwide.
Figure 18. Sanitary landfills

The Quezon City Sanitary Landfill or the Payatas dumpsite was closed due to
violation of existing environmental laws, rules and regulations by the landfill’s
operator, IPM Environmental Services, Inc. and susceptibility to trash slide.
Assistance was continued to be provided in closing and rehabilitating the seventy-
six (76) dumpsites, assistance was continued to be provided in closing and
rehabilitating the seventy-six (76) dumpsites in the Manila Bay regions including
one (1) dumpsite in Palo, Leyte. The 75 LGUs within Manila Bay regions were
provided with Waste Shredder and Rapid Composters. In order to perform the
decentralized composting for mixed wastes, one hundred twenty-nine (129) LGUs
were given Rotary Drum Composters to implement the composting procedure.
Moreover, 10 selected LGUs within the MBR were given with 10 Plastic molders
where high volume of plastics exists (Annex 9).
The implementation of R.A 9003 was stepped up by deploying two hundred twenty
(250) Basura Patrollers for EMB-Regional offices and thirty (30) patrollers under
595
the supervision of the EMB-Central office. Due to the notable accomplishment of

the patrollers, the EMB management decided to upgrade the terms of reference of
the patrollers and converted their title to Solid Waste Enforcers and Educators Team
(SWEET) which marked the beginning of the Solid Waste Enforcement and
Education Program (SWEEP). Under this program, the team was mobilized to
intensify the awareness campaign in every LGU down to the barangays as well as
to monitor and maintain the cleaned-up and rehabilitated sites.
Through the SWEEP, more partnerships were spurred with various industries and
other national and local government agencies. IEC and clean-up activities were
intensified and private entities serving as environment partners exhibiting excellent
environmental performance were recognized. The program also increased the
awareness of the communities along esteros/waterbodies. With the clean-up of
waterbodies, water pollution, flooding, and the incidence of water-borne diseases
were mitigated.
Monitoring of ESWM Implementation
“Bayan Ko, Linis Ko”
From the waste mapping of the Solid Waste Enforcers and Educators Team,
(SWEET), a total of 3,072 violations in public places such as roadsides, sidewalks,
canals, creeks and esteros were resolved by the 250 SW Enforcers and Educators
Team nationwide. Also, the DENR held massive clean-up activities adopting the
ridge to reef approach, dubbed as “Bayan Ko, Linis Ko”. In 2017, the clean-up was
participated in by 2,987 LGUs and 288 sites were cleaned.
BEFORE AFTER
Figure 19. Cleanup activity in Pagsanjan, Laguna
Figure 20. Soil cover in Polangui, Albay
Figure 21. Vegetative cover in San Antonio, Nueva Ecija
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With regard to LGUs’ compliance with RA 9003, in 2017, there were 712 LGUs
complying which comprises about 47% of the total number of LGUs.
6. Geohazard, Groundwater Assessment and Responsible Mining
The geohazard assessment program intends to improve the adaptive capacities of

communities to geologic hazards, such as, rain-induced landslides, floods,
flashfloods, ground subsidence or sinking and other forms of slope instabilities that
are not directly induced by earthquakes or volcanic activities.
Vulnerability and Risk Assessment
The vulnerability and risk assessment is conducted to update the existing landslide
and flood hazard map of the municipalities and do anecdotal interviews with
barangay officials to trace histories of flooding and landslide occurrences within the
area. This is a follow-up project of the completed 1:10,000 geohazard project which
was already done in 2014.
For 2017, the DENR, through the Mines and Geosciences Bureau (MGB), assessed
204 cities/municipalities (102%) in the 53 provinces of Nueva Ecija, Davao
Oriental, Sultan Kudarat, Abra, Ilocos Sur, Isabela, Quezon, Oriental Mindoro,
Camarines Norte, Sorsogon, Iloilo, Aklan, Cebu, Western Samar, Davao del Norte,
So. Cotabato, Agusan del Norte, Benguet, Pangasinan, Zamboanga del Sur,
Laguna, Batanes, Camarines Norte, Bohol, Leyte, Zamboanga del Norte, Lanao del
Norte, Saranggani, Agusan del Sur, Aurora, Albay, Antique, Camiquin, Cotabato,
Surigao del Sur, Tarlac, Cavite, Marinduque, La Union, Ilocos Norte, Capiz,
Compostela Vallet, Batangas, Occidental Mindoro, Ifugao, Palawan, Mt. Province,
Apayao, Dinagat Island, Zamboanga Sibugay, Negros Occidental Zambales,
Misamis Occidental and Davao Occidental. This resulted in the generation of the
1:10,000 scale geohazard maps.
Updating of 1:10,000 Scale Geohazard Maps
The updating is due to the effect of natural calamities that hit the local government
units to alter the susceptibilities. This activity was conducted in 22
cities/municipalities covering Pantabangan, Nueva Ecija, Lebak, Sultan Kudarat;
San Pablo, Isabela; Cabagan, Isabela; San Teodoro, Oriental Mindoro; Matnog,
Sorsogon; Mina, Iloilo; Zumarraga, W. Samar; Pagsanjan, Laguna ; Sibonga, Cebu;
Kapatagan, Lanao del Norte; San Isidro, Davao Oriental; Sagada, Mountain
Province; Taguig City, Metro Manila; Pasig City, Metro Manila; Muntinlupa City,
Metro Manila; Agoo, La Union; Midsalip, Zamboanga del Sur; San Miguel, Surigao
del Sur; Quezon City, Metro Manila; Caloocan City, Metro Manila; and Gubat,
Sorsogon.
Detailed Sub-surface Assessment
Sub-surface assessment was formalized in 2015 to determine subsidence hazards

and sinkholes in karst areas. It was done in response to the 7.2 intensity earthquake
that hit Bohol in 2013.
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For 2017, 15 cities/municipalities were assessed to identify and locate existing

sinkholes as well as to delineate areas of possible sinkholes in order to produce
sinkhole inventory and karst subsidence susceptibility map.
It also aimed to increase awareness on sinkholes and other karst subsidence hazard
and to issue threat advisories to LGUs and recommend possible prevention and
mitigation relative to the hazard. Using satellite images, the Interferometric
Synthetic Aperture Radar (IFSAR), interpretation, geologic and geomorphologic
information combined with anecdotal accounts from the locals, and conduct of
Ground Penetrating Radar (GPR) survey, the location of existing sinkholes and
surface collapse/subsidence susceptibility of the study area was determined.
Intensive IEC Campaign on Geohazard and Vulnerability Risk Assessment Maps
As part of the objective to disseminate the results of the geohazard mapping

assessment down to the barangay level, the MGB held an Information and
Education Campaign (IEC) on Geohazards for various municipalities. A series of
seminars entitled “Training-Workshop on Understanding 1:10,000 scale Geohazard
Maps” was conducted by the MGB Regional Offices in partnership with the
Department of Interior and Local Government (DILG).
For 2017, a total of 13,064 barangays were covered in the IEC campaign. Geohazard
maps were disseminated and barangay captains/officials were informed on how to
read and understand the said maps. Due to scheduling concerns with other LGUs,
some barangays were rescheduled for CY 2018 to complete the 42,036 barangays
in the entire country.
The geohazard maps were found to be useful in Comprehensive Land use Planning,
Climate Change and Disaster Risk Assessment (CDRA), Local Climate Change
Action Planning, PDRRM planning, MDRRM planning, BDRRM planning,
Development and Infrastructure Projects and Disaster Risk Reduction and
Management Plans and Programs.
7. ENR Research and Development
Research, Development and Extension Programs (RDE)
In order to provide appropriate technologies and information through Research,

Development and Extension (RDE), nine (9) RDE Programs were implemented.
These would contribute in climate change mitigation, sustainable development,
conservation and management of the natural resources, environmental management
and pollution control, and improvement of forest tree species. A total of 36 R&D
projects, with 51 studies, were implemented, in which 20 studies were completed
this year.
The above technologies were disseminated through production and distribution of

IEC materials, exhibits, technology forums, Focus Group Discussions (FGD),
capacity-building activities (trainings), media releases, and educational/
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appreciation tours. These mainly promote the adoption of generated technologies

and awareness and understanding to the beneficiaries.
The beneficiaries such as LGUs, People’s Organizations (POs), academe and other
stakeholders signified their interest to adopt the generated technologies.
Production of Quality Planting Materials (PQPM)
In support to the NGP, a total of 1,209,353 quality planting materials were

produced, exceeding the annual target of 980,000. Of these, 529,541 clonal
seedlings were produced by the DENR, through the Ecosystems Research and
Development Bureau (ERDB) and its research centers, and 679,812 cloned
seedlings were produced by 27 State Universities and Colleges (SUCs) tapped by
DENR to support the production of quality planting materials through the clonal
facilities and nurseries.
The seedlings produced by ERDB and its partner SUCs have been delivered and
planted in the designated NGP sites nationwide. A total of 1,944 hectares were
established at the designated NGP sites of ERDB and its Research Centers.
Figure 26. Cloned molave planting materials

produced by Tarlac Agricultural University
In support to the production of quality planting materials, twenty-three (23) clonal

nurseries and the identified Seed Production Areas (SPAs)/Individual Plus Trees
(IPT) in 76 provinces were maintained by ERDB and the research centers.
To further improve the growth of the seedlings, 1,100 tons of mychorrizal

inoculants were produced by ERDB and its satellite offices, of which 208.5 tons
were distributed to the field offices.
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ÓFFICE/SATELLITE FACILITY TARGET ACCOMPLISHMENT
TOTAL 1,100 1,100
ERDB Main Office 500 500
Zambales (RMTU) 200 200
Bohol (BISU) 200 200
Agusan del Norte (CSU) 200 200
Table 7. List of Mychorrizal Inoculants Production
8. CLIMATE CHANGE RESILIENCY, MITIGATION AND ADAPTATION
Formulation of the CCAM-DRR Roadmap for 2018–2022
With DENR as the Chairperson of the Cabinet Cluster on Climate Change

Adaptation, Mitigation and Disaster Risk Reduction (CCAM-DRR), it initiated the
formulation of the CCAM-DRR Roadmap for 2018-2022 in collaboration with
various government agencies. On 18 January 2018, a Resolution was issued by
Secretary Cimatu during the 4th CCAM-DRR Cabinet Meeting adopting the said
Roadmap.
The roadmap defines the overall goal of the Climate Change Adaptation, Mitigation
and Disaster Risk Reduction Cluster which is to achieve “Climate and Disaster-
Resilient Communities Supporting Equitable and Sustainable Development”. The
four outcomes of the roadmap are: (1) increased adaptive capacities of vulnerable
communities; (b) ensured adequate supply of clean, water and other natural
resources; (c) increased resilience of critical infrastructure; and (4) enhanced
knowledge, access to information and institutional capacities.
Formulation of the Mindanao Action Plan (MAP) for Ensuring Water Sufficiency
and Food Security amid Climate Change (2019‒2022)
In compliance with the 2017 SONA directive, the DENR, together with the
Departments of Agriculture and Public Works and Highways, led the formulation
of the Mindanao Action Plan (MAP) for Ensuring Water Sufficiency and Food
Security Amid Climate Change (2019‒2022).
The overall goal of the MAP is “to establish climate and disaster-resilient food and
agricultural system in Mindanao”. Its major objectives are to: (1) protect watershed
and water resources supporting food production; (2) provide effective and
appropriate support services to farmers and other food producers; and (3) establish
climate and disaster-resilient agricultural communities.
A Joint DA-DENR Administrative Order establishing a coordinative mechanism

for the MAP implementation was drafted.
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Formulation of the Implementation Plan of Disaster Resiliency Measures for Metro

Manila and Its Surrounding Areas
Per 2017 SONA directive, the DENR led the drafting of the proposed
Implementation Plan of Disaster Resiliency Measures for Metro Manila and Its
Surrounding Areas. The Plan aims to address the earthquake hazard impacts for
Metro Manila and its environs. The overall goal is to achieve “Resilient Metro
Manila and its surrounding areas against Earthquake Impacts”. This was endorsed
to the Office of the Cabinet Secretary for integration in the CCAM-DRR Roadmap.
Formulation of the Risk Resiliency for Sustainability Program (RRSP), under the
Strategic Program for Climate Resilience
In 2017, the Philippines, through the DENR, was able to tap US$1.5 Million under
the Climate Investment Fund for the Development of the RRSP. The Philippine
Program Document on this, along with nine other pilot countries, had been
presented and approved in the Sub-Committee Meeting of the Climate Investment
Fund in December. The Program proposed priority investments in 22 climate-
vulnerable provinces in the country, particularly in the areas of Social Enterprises
and Innovation; Integrated Water Resources Management; Coastal Protection in
Selected Areas; and Climate Information Services for Decision Making.
Conduct of Capability-Building for DENR Climate Change Focal Persons at the

Central, Regional and Local Offices
A series of capability-building sessions for the DENR Climate Change Focal

Persons were conducted aimed at increasing the understanding on the general
concepts and science of climate change and the different approaches of
mainstreaming climate change concerns in DENR plans and programs.
Designation of DENR as the National Designated Authority (NDA) for Green

Climate Fund (GCF)
In February 2017, the DENR was designated as the National Designated Authority
(NDA) for Green Climate Fund (GCF). The GCF serves as the operating entity of
the financial mechanisms of the United Nations Framework Convention on Climate
Change (UNFCCC). It is a US$10 Billion fund established by 194 governments to
respond to climate change through investments on low emission and climate-
resilient development projects.
As the NDA, the DENR started implementation of the GCF Readiness Program
(GCFRP). This is a global initiative funded by the German Federal Ministry for the
Environment, Nature Conservation, Building and Nuclear Safety (BMUB) and
implemented by the United Nations Development Programme (UNDP), United
Nations Environment Programme (UNEP) and World Resources Institute (WRI).
The program aims to support the capacitation and empowerment of the DENR as
the NDA for GCF, including relevant partner-government agencies.
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9. ENHANCED BIODIVERSITY CONSERVATION
Ecotourism Development
Thirteen (13) sites with potentials for ecotourism were assessed and twenty-seven
(27) ecotourism management and business plans were developed. Ninety (90)
ecotourism facilities were maintained and rehabilitated to cater and serve
visitors/tourist needs. These include cottages, information centers, viewing deck,
and campsites.
Cave Management Program
In consonance with the conservation and management of caves and cave resources
as provided in the National Caves and Cave Resources Management and Protection
Act, a total of 105 caves were assessed and recommended for classification.
Assessment activities include survey and mapping to determine the extent of the
area of management. Since CY2012, a total of 547 caves have been classified.
Classification will determine what specific land use and management will be
implemented in the cave system.
Seventy-four (74) Cave Management Plans have been drafted, reviewed, and
finalized. Plans for thirty five (35) caves were implemented in 2017. In line with
this, twelve (12) Memoranda of Agreements (MOAs) were forged with partner
LGUs for cave conservation and management.
Wetland Conservation Program
As one of the most diverse and productive ecosystems, wetlands also require
effective management. They provide essential services and serve as sources of fresh
water. A total of twenty-four (24) identified wetlands were assessed and sixteen
(16) Wetland Management Plans were prepared in collaboration with different
stakeholders.
Protection and Conservation of Wildlife
Several activities were conducted for the conservation of various endangered

wildlife species like the Philippine Eagle, Marine Turtles, Philippine Crocodile,
Tamaraw, Dugong, and Tarsier.
In 2017, there were twenty-five (25) sightings of Philippine Eagle nationwide;

higher than the previous year’s sighting of nineteen (19). On the other hand, a total
of 401 tamaraws were sighted and recorded; lower than the previous year. One
possible reason is the traditional hunting practice of the Indigenous People (IP) in
Mts. Iglit-Baco National Park in Oriental and Occidental Mindoro. A total of 1,120
heads of Crocodiles were maintained in Crocodile Farm in Palawan.
The DENR held its first ever Biodiversity Congress on May 22‒24, to promote and
stress the importance of protecting and managing the biological diversity and
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ecosystems. It coincided with the celebration of the International Day for Biological
Diversity with the theme “Upwelling of Lessons, Sustaining Community Benefits
in the Conservation of Landscapes and Seascapes”.
The event dealt with five thematic areas, namely: Managing Protected Areas;
Biodiversity-friendly enterprises; Landscapes and Seascapes; Biodiversity
Financing and Social Topics like building an inclusive biodiversity community; and
participation of indigenous peoples, women, youth and communities in conflict-
affected areas.
10. LAND MANAGEMENT
Land Disposition
Pursuant to Comprehensive Agrarian Reform Law to improve the quality of lives

of farmers and farm workers through greater productivity of agricultural lands, a
total of 28,705 agricultural patents were issued to qualified beneficiaries. In
consonance with Republic Act 10023, a total of 42,196 patents were issued to
untitled public alienable & disposable lands which have been zoned as residential.
Land Administration and Management System (LAMS)
To fully utilize the Land Administration and Management System (LAMS) while
waiting for the massive land records data capture to be administered through
outsourcing, scanning and encoding activities were started. As a result, a total of
19,784,216 land records were scanned and 7,116,483 were encoded, equivalent to
18% and 22% of the universe, respectively.
With the approval of data capture implemented by administration, a total of

9,636,971 land records were encoded and 45,692,523 were scanned, which
represent 31% and 42%, respectively, of the total universe.
The figure below shows that more than half of the universe was already
accomplished as of December 31, 2017 and only 37% for encoding and 31% for
scanning were left to be completed through outsourcing. The completion of the data
capture activity plays a very important aspect in building the spatial Digital
Cadastral Database (DCDB) of LAMS Philippines with the intention of sharing it
to the Local Government Units to support local planning, tax assessment and land
management.
ENCODING
10,000,000
5,000,000
-
2016 2017 For Outsourcing
Survey Plans Lot Data Computations (LDCs) Public Land Applications (PLAs)
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Figure 28. Comparison of data of encoded survey plans, LDCs, and PLAs
in 2016, 2017, and for outsourcing
SCANNING
30,000,000
20,000,000
10,000,000
-
2016 2017 For Outsourcing
Survey Plans Survey Documents
Lot Data Computations (LDCs) Public Land Applications (PLAs)
Figure 29. Comparison of scanned survey plans, LDCs, survey documents,
and PLAs in 2016, 2017, and for outsourcing
To date, the DENR was able to scan a total of 65.47M and encode 16.75M public land
and survey records nationwide, broken down as follows:
Scanned 65,476,739 survey records (in sheets):
Survey Plans 1,590,175

Survey Documents 11,725,698
Lot Data Computations 16,574,062
Public Land Applications (PLAs) 35,586,804
Encoded 16,753,454:
Marginal Information from Survey 1,186,574

Plans
Lot Data Computations (LDCs) 12,708,296
parcels/lots
Public Land Applications (PLAs) 2,858,584
carpetas
Land Records Data Capture
The Land Records Data Capture was continued to transform all land records into digital
format for easy access, retrieval and storage of data in accordance with the
specifications of the Land Administration and Management System (LAMS).
For CY 2017, encoding of registry books (per lot) accomplished 706,831 lots, out of
annual target of 656,000 lots or 108%; while validation/quality assurance of registry
books, with an annual target of 656,000, accomplished 706,831 equivalent to 108%.
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Reconstruction of Old/Missing/Destroyed Survey Records
All missing/old/destroyed parcels/records are reconstructed in order to populate the

LAMS Digital Cadastral Data Base (DCDB) in preparation for the development of 3D
Cadastre in the Philippines.
Technical Bulletin No. 1 series of 2017 provides the step-by-step procedure in the
implementation of the activity. The process starts with the inventory of missing records
followed by the conduct of research within the DENR Regional Offices and other
agencies such as the Assessor’s Office and Registry of Deeds. The data gathered will
be plotted and cleansed using any computer aided drafting (CAD) software or
geographic information system (GIS) software. Lastly, the lot data computation (LDC)
sheet shall be produced and certified by the Chief Surveys and Mapping Division of the
DENR Regional Offices. The signed LDC and scanned references will serve as
attachments in the uploading of the record in the LAMS Philippines.
For 2017, a total of 439,800 lots were reconstructed, out of the total target of 440,300
lots, or almost 100%.
B.11. COASTAL AND MARINE ECOSYSTEMS MANAGEMENT
The DENR’s nationwide program for the coastal and marine environment which
will run from 2017 to 2028, the Coastal and Marine Ecosystems Management Program
(CMEMP), has build on the previous efforts of DENR on the management of the coastal
and marine environment which included the Coastal Resources Management Project
(CRMP) implemented from 1996 to 2004, the Integrated Coastal Resources
Management Project (ICRMP) from 2007 to 2015 and the Sustainable Coral Reef
Ecosystems Management Program (SCREMP) undertaken from 2013 to 2015.
In accordance to DENR Administrative Order No. 2016-26, the program generally aims
to achieve the effective management of the country’s coastal and marine ecosystems
thereby increasing their ability to provide ecological goods and services to improve the
quality of life of the coastal population particularly ensuring food security, climate
change resiliency and disaster risk reduction and covers all coastal and marine areas of
the Philippines covering all, but not limited to the NIPAS Marine Protected Areas
(MPAs), Locally-Managed Marine Protected Areas (LMMPAs), Marine Key
Biodiversity Areas (MKBAs), and adjacent municipal waters.
CMEMP specifically aims to: (1) Implement sustainable management of coastal and
marine resources to contribute to food security and improve human well-being of the
coastal communities; (2) Establish a well-connected network of MPAs to ensure the
effective and sustainable management of coastal resources; (3) Effectively reduce
threats and factors of degradation on coastal and marine ecosystems; (4) Enhance the
formation of positive values among all stakeholders including the youth through shared
responsibilities in sustainable management of coastal and marine resources and habitat.
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MPA Network Establishment and Strengthening
a. Mapping of Coastal Habitats for potential livelihood opportunities
A total of 107,807 ha. out of 85,592 ha. of coastal and marine habitats have been
assessed nationwide using different survey methods (such as, photo transect, Reef
Check), data analysis, and interpretation of the habitat condition (both quantitative
and qualitative) are adopted by the Regions. The BMB Technical Bulletin No. 5
series of 2017 – Guidelines on the Assessment of Coastal and Marine Ecosystems
issued in February 2017 has guided the Regions in the conduct of assessment.
Results from the assessment,
including remote sensing
images and other relevant
data on these habitats, have
been gathered and
consolidated to produce
baseline and preliminary
maps showing the extent of
the habitats. The status of the
habitats assessed were also
determined, further providing
basis whether these potential
sites for ecotourism and
biodiversity-friendly
enterprises/livelihood. Figure 30. Map showing the coastal resources of
Tagbilaran City, Bohol in Region 7 including the transect
lines established in the coral reef area
b. Environmental and Socio-
economic baselining for Impact
Indicators under CMEMP
Meanwhile, environmental and socio-

economic baselining involved both
qualitative and quantitative survey
methods to measure the knowledge,
attitude and practices (KAP) of
stakeholders and to establish a new set of
baseline data for the development of
CMEMP communication strategies. A
total of 278 out of 262 coastal barangays
have been surveyed as guided through
the BMB Technical Bulletin No. 10 series Figure 31. Focus Group Discussion conducted
for the KAP Survey within Lumaniag, Lian,
of 2017 – Guidelines on the Conduct of Batangas in Region 4A
Knowledge, Attitude and Practices (KAP)
Survey for the CMEMP and the BMB
Technical Bulletin No. 17 series of 2017 – Supplementary Guidelines on the
Conduct of KAP Survey for the CMEMP issued in June and November 2017
respectively. Interviewees comprising local chief executives and LGU key officials
(MENROs, MAOs and other concerned officials); household heads (usually
fishermen); People’s Organizations; students/youth (aged 15-24 years old); school
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heads and teachers; and local business owners/entrepreneurs represent 10% of the
total population of the target barangays. While the surveys have been conducted,
the survey results will still be summarized and analyzed for interpretation to serve
as basis in preparing the Communication Plan.
c. Establishment of Marine Protected Area (MPA) Networks
The 27 of the targeted 27 MPA Networks to be established nationwide should

magnify the benefits of individual MPA sites, protect large-scale processes, slow-
down the loss of endangered marine species, and restore depleted fisheries.
Activities conducted include institutional arrangements through signing of
Memorandum of Agreement/ Memorandum of Understanding between local
governments, formulation of multi-year MPA Network Action Plans, Citizen
Science trainings, among others. Further, MPA Networking promotes knowledge
enhancement and capability building among MPA Network managers.
Biodiversity-Friendly Enterprise
Development
Anchored on the Sustainable Development

framework, the establishment of biodiversity-
friendly enterprises should ensure
conservation, sustainable use and equitable
sharing of resources, as well as, promotion of
sustainable businesses that support
environmental protection, economic growth and social equity among communities in
the upland and coastal areas within and Figure 32. Training on Bamboo Novelty Making
around Protected Areas. in Brgy. Alegria, Alabel, Sarangani Province
in Region 12 with Moleng Farmers
The Regions have supported 132 out of 125 Tribal Association
targeted BDFEs nationwide following the
BMB Technical Bulletin No. 11 series of 2017 or the Guidelines in the Identification
and Recognition of Biodiversity-friendly Enterprise (BDFE) issued in July 2017.
A series of consultations and meetings with the People’s Organizations (POs) engaged
in the BDFEs, as well as, orientation and related trainings involving partner Agencies
such as BFAR, DTI, and DOST have been provided for them. Preparatory works for
the construction of production facilities and procurement of processing materials have
also been conducted by some of the POs nationwide.
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Maintenance and Protection
Among the activities conducted by the Regions

on maintenance and protection of coastal and
marine ecosystems include assessment using
the Management Effectiveness Tracking Tool
(METT) Tool1; delineation and demarcation of
MPA boundaries; installation and inspection of
buoys; regular monitoring/ foot patrolling;
organization and mobilization of the Blue
Brigade; coastal/beach cleanups and
SCUBAsurero, an underwater cleanup
Figure 33. MPA patrolling conducted by
activity; monitoring and maintenance the CRMFS team together with the
operations on the restocked/ reseeded Giant Enforcement Division from DENR
Clams, procurement of technical and scientific Region 13 and the monitoring team
from BFAR
equipment; IEC on solid waste management;
consultative meetings and related
orientation/trainings with concerned stakeholders; and purchase of materials and
equipment intended for maintenance and protection, among others.
Capacity Building
Under the Capacity Building component of CMEMP, three (3) major activities have
been conducted in the Regions: (1) Training on MPA Management which covered
coastal and marine spatial planning, and MPA Networking; (2) Capability Building for
Stakeholders (Citizen Science) which trained MPA managers on monitoring and data
presentation using various methods; and (3) Social Marketing and Mobilization
Enhancement Training to sustain the management of NIPAS MPAs using a
communication framework and set of strategies and approaches that promote public
awareness, instill social and environmental consciousness, and effect behavior change
towards the coastal and marine ecosystems. Accordingly, about 61 out of the 58
targeted workshops/training on Social and Natural Science Citizenry for communities
have been conducted to strengthen their knowledge and skills in the protection and
conservation of coastal and marine habitats.
Knowledge Management
The regional webpages developed nationwide are dedicated for coastal and marine
activities where the Integrated Coastal and Marine (ridge-to-reef) approach strategy is
implemented. Accordingly, regional database, i.e. data, reports, and photos, including
other data sources such as the Municipal Coastal Database (MCD), are continuously
consolidated and updated in the Regions.
1
a scorecard developed by the World Bank (WB) – World Wildlife Fund (WWF) Alliance to assess progress made towards
achieving management effectiveness goals originally for terrestrial PAs and piloted for a Marine Protected Areas (MPAs)
during the run of the Integrated Coastal Resources Management Project or ICRMP (2007-2014) implemented by the DENR,
DA-BFAR, and DOF-MDFO
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Communication, Education, and Public Awareness (CEPA)
The development and maintenance of a flagship communication campaign per NIPAS

MPA were conducted in the Regions through the identification of flagship species for
site-specific campaigns and brand development.
The annual celebration of the Month of the Ocean and International Coastal Clean-up
and conduct of learning events and related , information, education, and communication
(IEC) and advocacy campaigns have been continuously promoting environmental
awareness of local communities, as well as, appreciation for the coastal and marine
environment.
In addition, the deployment and retrieval of Autonomous Reef Monitoring Structures

(ARMS) which is part of a global initiative to monitor ocean acidification effects on
marine biodiversity have been linked with awareness campaigns. Through Hands-on-
ARMS activities, the awareness and appreciation of communities on marine
biodiversity have been promoted.
Technical Assistance to LGUs
A total of 97 out of the 89 targeted LGUs have been provided with technical assistance
through conduct of Participatory Coastal Resource Assessment (PCRA) and other
related habitat assessment training, dissemination of relevant Technical Bulletins such
as the BMB TB 2017-14 Guidelines on the Application of Integrated Coastal
Management (ICM) as a strategy of CMEMP and BMB TB 2017-13 Guidelines on the
Implementation of Environmental Standards for Diving and Snorkelling, orientation on
the Green Fins Approach, development and updating of ICM Plans, updating of
Municipal Coastal Environment Profiles (MCEP) review of local ordinances related to
coastal and marine ecosystems management, as well as, developing sustainable
livelihood.
C. Payapa at Masaganang Pamayanan (PAMANA)
The PAyapa at Masaganang PamayaNAn (PAMANA) is one of the projects of the

Department of Environment and Natural Resources which supported the
implementation of the National Greening Program (NGP) by integrating it in the
activities on forest protection and development. This is also in support to the peace
process undertaken by the Office of the Presidential Adviser on the Peace Process
(OPAPP) for the integration of the former and current rebel groups. Through a Joint
Memorandum Circular, OPAPP and DENR agreed to provide employment
opportunities to beneficiaries in support of the peace process through forest protection,
National Greening Program and other forestry-related activities.
In PENRO Negros Occidental in Region 6, a 2-kilometer graded trail connecting the
NGP site to the adjacent community was rehabilitated and maintained. This trail
provides easier access to transport the products from the Provincial Development
Council to the adjacent community.
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To prepare the forest guards in undertaking entrepreneurial livelihood activities in the

future, trainings on bamboo furniture-making and welding were conducted in Abra and
Ifugao, in coordination with the Department of Trade and Industry (DTI).
In Region 6, a 60-hectare riverbank was rehabilitated situated at Brgy. Cabugao, Brgy.
San Jose and Brgy. Rivera, Ibajay, Aklan. A 500-meter long and 1.5-meter wide access
trail was constructed by Kapatiran Para sa Progresibong Panlipunan, Inc.
(KAPATIRAN) within the Peace and Development Community site in Ibajay, Aklan.
The Forest guards hired in CENRO Kabankalan City apprehended one (1) tricycle
loaded with charcoal.
A total of 673 forest guards were hired, as follows: 545 in CAR; 100 in Region 6; 18 in
Region 7; and 10 in Region 10. These forest guards complemented with the regular
Forest Protection Officers who conduct monitoring using the LAWIN Forest
Biodiversity Protection System in the forest protection works within their jurisdiction.
They assisted in patrol work of untenured forestlands, manning of checkpoints,
apprehension of illegally cut or gathered forest products or minerals, collection of forest
seeds and wildlings, and nursery activities.
Forest guards were able to conduct patrol and ground surveillance within a total area of
6,000 hectares. About 167-hectare site was established, 730.87 hectares were
maintained and 170 hectares were monitored and assessed.
In addition, 130,420 seedlings composed of indigenous forest and fruit trees were
produced thru PAMANA in Regions 6 and 7 with 13,000 and 117,420 seedlings,
respectively. The seedlings were distributed to support the implementation of NGP,
particularly for replanting under maintenance and protection.
D. ACCOMPLISHMENTS OF ATTACHED AGENCIES
1. NATIONAL WATER RESOURCES BOARD (NWRB)
Policies Formulated and Approved
The NWRB formulates policies and plans for the Philippine water sector, within the
framework of Integrated Water Resources Management (IWRM) through the
coordination and integration of development programs, projects and activities. A
total of five (5) policies were approved by the Board for CY 2017, as follows:
a. Monthly Water Allocation for Irrigation and Municipal Water Supply from the
Angat Dam
b. Authority Granted to the Executive Director to Issue IDs to DENR Deputized

Personnel
c. Defining the ECC/CNC Requirements for Water Permit Applications
d. Amendment to Authority Given to the Executive Director to Cancel All

Unclaimed Water Permits Issued on or before October 31, 2015.
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Water Resources Assessment
The assessment of two (2) major river basins, Agno and Panay River Basin, was
completed as well as the Comprehensive Water Resources Assessment of Eighteen
(18) Major River Basins.
The Development of Groundwater Management Plan (GMP) and Establishment of

Groundwater Monitoring Wells in Critical Areas were undertaken for groundwater
assessment. For 2017, Groundwater Management Plan for Bacolod City and
Surrounding Areas was developed and thirteen (13) wells were established in highly
urbanized water constraint areas/cities: 4 in Metro Manila; 6 in Angeles City; 1 in
Bacolod City; and 2 in Cavite.
A total of twenty-five (25) water resources assessment on groundwater availability

were conducted and eight (8) Certificates of Water Availability for PEZA were
issued
Water Resource Regulation
A total of 801 water permit applicants were issued Conditional Water Permits, out
of 2,594 water permit applications received. Of these 801 applicants, only 271 water
permits were issued.
Another important aspect of water use regulation is the resolution of conflicts

regarding the use of water. About 967 cases were received which include the cases
carried over from the previous years. Of these, 179 cases were disposed/resolved
and 788 cases are still under various stages of investigation.
To prevent land subsidence, well interference and saltwater intrusion problems due
to excessive groundwater extraction, no person is allowed to drill any well for the
extraction of groundwater or to make any alteration to any existing well without
first securing permit from the Board. For the year 2017, the Board granted a total
of 318 permits to drill (PTD).
Economic Regulation
Ocular inspection and verification of 199 Certificates of Public Convenience (CPC)

grantees and non-CPC grantees was conducted. Discharge measurements were
undertaken to verify yield capacity of sources and compare findings with water
grants and actual operation. Inspection, testing and sealing of 98,840 water meters
used by water appropriators in their waterworks system was also undertaken.
In 2017, ocular inspection of the structures of 3,873 sources of permittees/grantees

for industrial, commercial, municipal/domestic and other purposes commenced.
Verification as to beneficial use was conducted and recommendations for water
permit cancellation and closure orders were issued to the owners of abandoned or
non-operational sources. Inspection and verification of structures and operation of
non-permittee appropriators and users was conducted, involving 2,635 sources,
611
including those 167 with water permit applications. For the period in review, three
(3) notices and orders were issued to legal and illegal water users combined.
2. NATIONAL MAPPING AND RESOURCE INFORMATION

AUTHORITY (NAMRIA)
Production of Charts and Maps

NAMRIA produced the following navigational/nautical charts and maps compliant
to standards.
- 10 Electronic Navigational Charts
- 26 Nautical Charts
- 360 index maps at a scale of 1:4,000 Large Scale topographic maps
- 55 enhanced topographic maps at a scale of 1:10,000
- 1,800 index maps of 1:10,000 Large Scale Topographic Base maps
- 45 of 1:50,000 scale enhanced Topographic maps
- 5 of 1:250,000 scale updated Topographic maps
- 14 Administrative maps
- 20 Provincial Land cover maps
- 20 Protected Area maps
- 17 coastal Resource maps
- 10 maps of Low-lying Areas Vulnerable to Sea Level Rise
Geospatial Data Infrastructure
The NAMRIA Geospatial Data Infrastructure (NGDI) addresses primarily the
management of geospatial data derived from other NAMRIA strategic programs
dealing with mapping, charting and surveying which cover the entire Philippine
archipelago. It also aims at enhancing the existing GIS and ICT infrastructure of the
agency to support the management of the Philippine Geoportal (PG), an online map
system or application that manages the open sharing of and access to geospatial data
holdings of NAMRIA and other government agencies.
Accomplishments for the year include the following: two systems analysis
(Enterprise Geospatial Data Infrastructure (EGDMIS) and Philippine Geoportal –
Terrain Draping Map App; one database design; two systems design; four programs
and systems developed (Environment and Natural Resource Management System
Information System (ENRMIS) and Maritime Information System (MarIS).
3. PALAWAN COUNCIL FOR SUSTAINABLE DEVELOPMENT

STAFF (PCSDS)
Issuance of SEP Clearances and Permits
In line with the amended PCSD Administrative Order No. 6, the PCSD issues
Strategic Environment Plan (SEP) Clearances to projects and establishments in
Palawan after thorough documentary and technical evaluation of project
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applications by taking into account ECAN Zoning and social acceptability. In 2017,
the PCSD issued a total of 152 SEP Clearances to projects and establishments.
Meanwhile, the PCSD, as a designated implementing authority of R.A. No. 9147 or

the “Wildlife Resources Conservation and Protection Act” in Palawan, issues
wildlife-related permits to project proponents engaging in the breeding or
propagation, research, collection, transport, export/import, trade, and utilization of
wildlife, wildlife by-products, or wildlife derivatives. A total of 11,720 wildlife-
related permits were issued by PCSD from January to December 2017.
Pursuant to R.A. No. 9175 or the “Chain Saw Act of 2002,” the PCSD issued 93
chain saw-related permits and certificates of registration (CORs) to applicants in
2017.
PERMITS AND CLEARANCES ISSUED QUANTITY

TOTAL 11,965
1. SEP Clearances 152
2. Wildlife related permits 11,720
Local Transport Permit 8,097
Wildlife Special Use Permit (WSUP) 237
WSUP Addendum 5
Wildlife Gratuitous Permit (WGP) 26
WGP Addendum 1
Wildlife Collectors Permit 3,332
Wildlife Import Certificate 6
Wildlife Export Certificate 13
CITES Permit Issued 3
3. Chainsaw permits and CORs 93
Table 8. Permits and clearances issued by PCSDS in 2017
The PCSDS monitors establishments and facilities to ensure compliance to the

terms and conditions prescribed in the SEP clearance or permit. In 2017, PCSDS
monitored a total of 2
613
Department of Finance
DEPARTMENT OF FINANCE (DOF)
BUREAU OF CUSTOMS
CY 2017 Accomplishments
1. TRADE FACILITATION: REDUCING TIME AND COST OF DOING BUSINESS

a. Zero Backlog in Stakeholder Accreditation
In line with President Rodrigo Duterte’s order to shorten processing time for letters,
requests, and permits, the Bureau of Customs addressed incidents of red tape after
directing all Customs offices to strictly act on requests and permits within five days.
In a memorandum number 24-2017, communication letters, requests, and other permits

shall be acted by the concerned office within five days upon receipt of documents.
Pursuant to the 5-day processing directive, the office responsible for accrediting
stakeholders, Accounts Management Office (AMO) has simplified the procedures in
the accreditation. AMO has reduced the process flow of accreditation from 11 steps to
six steps. It usually takes more than 15 working days for an importer and a customs
broker to be accredited by the Bureau of Customs.
As a result, 2,893 applications for accreditation received from October 23-December

22, 2017 were acted upon within the timeframe.
Finally, a total of one thousand eight hundred fifty-two (1,852) backlog applications
were processed which resulted to zero backlogs.
In 2017, AMO processed a total of 16,003 applications for accreditation and registration
of importers and customs brokers: 13,985 of which are importers while 2,018 are
customs brokers.
As per data from the Management Information System and Technology, there are
14,795 active importers and 1,888 active customs brokers in 2017.
b. CMTA Updates
Republic Act (RA) No. 10863, otherwise known as the Customs Modernization and
Tariff Act (CMTA), was enacted to amend the 59 year-old Tariff and Customs Code of
the Philippines (TCCP). The law becomes effective on 16 June 2016, fifteen days after
it was published in major dailies.
Since the enactment of the Customs Modernization and Tariff Act, the Bureau of
Customs has already four approved Customs Administrative Orders (CAO), 26 CAOs
under DOF review, seven CAOs under review by the BOC, and three drafted CAOs.
Among the signed CAO, one of the most significant orders in 2017 was the CAO
bearing provisions for the implementation of the Anti-Agricultural Smuggling Act of
2016.
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DOF – Annual Accomplishments for CY 2017
Violators of the Anti-Smuggling Act of 2016 will be penalized with a maximum penalty
of life imprisonment and a fine of twice the fair value of the smuggled agricultural
products and the aggregate amount of the taxes, duties, and other charges.
c. BOC Entry Verification System
The Bureau of Customs has replaced the sectioning system at the Formal Entry Division
with a Status Verification System at the Port of Manila and Goods Declaration
Verification System at the Manila International Container Port.
Under the SVS, valuation of imported goods can be monitored once the examiners or
appraisers input the data in the system, whether the particular shipment was
benchmarked or grossly undervalued.
The Verification System was implemented to prevent the collusion between and among
the stakeholders and customs employees and to test the competence and efficiency of
the examiners in applying the new customs law and regulations under RA 10863.
2. BORDER PROTECTION: INTENSIFYING ANTI-SMUGGLING EFFORTS
a. Apprehensions
In order to guard the borders of the country and stop the predominant smuggling activity
of the smugglers, BOC is closely monitoring big ticket commodities like oil, cigarettes,
alcohol, motor vehicles, minerals, and agricultural products which are often smuggled
by unscrupulous traders.
The strengthened anti-smuggling efforts of the Bureau resulted in P14.198 billion worth
of seized goods in 2017 which includes but is not limited to fake products, vehicles,
illegal drugs, and agricultural products.
Successful apprehensions were made through the joint efforts of the Office of the
District Collector of various ports, Customs Intelligence and Investigation Service,
Enforcement and Security Service, X-ray Inspection Project, and other enforcement
units.
 P14.198 billions of smuggled goods seized
Smuggling and other acts against customs law committed by large-scale syndicates
deprive the government of the much-needed revenues to support its socio-economic
programs for the Filipinos. Recognizing smugglers’ deplorable practices, the
Bureau of Customs heightened its operations against smuggling and illicit trade
which resulted in P14.198 billion worth of seized goods in 2017.
The Bureau of Customs also seized P164.9 million worth of cars including luxury
cars such as McLaren, Ferrari, Lamborghini, Mercedes Benz, Chevrolet Camaro
and Range Rover.
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 P6.63 billion worth of illegal drugs busted
President Duterte ordered the BOC to guard all borders against the entry of illegal
drugs. With this, the Bureau, through the various operations conducted by the
Customs Anti-Illegal Drugs Task Force (CAIDTF), Enforcement Group (EG),
Intelligence Group (IG), and Customs Intelligence and Investigation Service (CIIS),
was able to intercept billions worth of drugs in 2017.
During the time of then Commissioner Nicanor Faeldon, Customs agents recovered
in Valezuela City 605 kilos of methamphetamine hydrochloride or ‘shabu’
contained in a metal cylinder which came from China. It was estimated to be worth
P6.4 billion.
In addition to this, the Bureau successfully apprehended P234 million worth of

illegal drugs.
 P5.407 billion Mighty cigarettes with fake tax stamps busted
In 2017, the Bureau of Customs through the Special Studies and Project
Development Committee seized P5.407 billion worth of Mighty cigarettes with fake
tax stamps.
The Customs investigation and subsequent discovery of Mighty cigarettes with

illegal tax stamps prompted the Department of Justice to file a tax evasion case
against the company. As a result, the Mighty Corporation has agreed to pay in full
its tax liability of P30.4 billion.
The P30.4 billion tax settlement, the largest in Philippine history according to the
Malacañang, is seen to fund the infrastructure program of the present administration
–the Build, Build, Build Project.
b. Green Lane Suspension
With the growing volume of international trade and the increasing call for extensive
facilitation, the risk of smuggled goods to pass across national boundaries is high.
To control the movements while ensuring compliance with the laws, the Bureau of
Customs temporarily suspended the Green Lane of the Selectivity System until the risk
indicators in the Selectivity criteria are perfected. As provided by the system, all
shipments categorized under the Green Lane will not undergo any examination of the
Bureau of Customs and will be immediately cleared after the importers pay the
corresponding duties and taxes.
The temporary suspension is a preventive measure while the Risk Management

Selectivity System is undergoing evaluation and pending the issuance of new rules
regarding selectivity parameters. At present, shipments pass through the default Yellow
Lane or the Red Lane set up at a ratio of 55:45.
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c. BATAS Revs up Fight vs. Smugglers
The Bureau’s Action Team Against Smugglers (BATAS) under the Legal Service is
now the sole office tasked to run after smugglers after Commissioner Isidro Lapeña
ordered the abolition of the Special Studies and Project Development Committee
(SSPDC).
BATAS is responsible for the filing of cases with the Department of Justice against
importers, brokers and/or erring Customs officials and personnel for violating
provisions of the Customs Modernization and Tariff Act.
In 2017, 12 cases were filed with DOJ against CMTA violators. The apprehended goods
totalled a dutiable value of P6.5 billion.
A case against the importer and the brokers of the 605 kilos of shabu that was seized in
May was filed before the DOJ.
3. REVENUE COLLECTION: BOC ACHIEVES 98% OF 2017 COLLECTION

TARGET
President Rodrigo Duterte has challenged the Bureau of Customs to step up revenue
collection and surpass the 2017 target set by the Department of Finance to fund the priority
development programs of the government.
The Bureau of Customs exhausted all means to increase its 2017 collection through proper
assessment of duties and taxes and tapping of non-traditional sources of revenue. All efforts
bore an all-time high collection in 2017. For the year, P458.183 billion collection was
achieved by the Bureau of Customs against the P467.896 billion target. The revenue
performance in 2017 is an impressive 98% increase in collection compared with the 81%
in 2015 and 80% in 2016.
BOC collected in November P3.843 billion and P46.37 billion -the highest daily and
monthly collection respectively, recorded in the entire history of the agency. The Bureau
collection in November jumped P2 billion and P11 billion higher compared to the average
collection recorded by the Financial Service at 1.8 billion daily and P35 billion monthly.
Despite the increasing

percentage of non-dutiable
imports, at a high of 85% for
this year, the Bureau still
managed to close the gap
between its target and
collected revenue. The
increase in revenue is attributed to the improve valuation and correct tariff classification
fuelled by intensified collection of duties and taxes.
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4. 2017 BOC PERFORMANCE BY THE NUMBERS

a. Top Performing Ports
b. Trading Partners
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c. ASEAN Trade
Despite being the source of revenue for the government, trade liberalisation involves
removing trade barriers such as tariff on imports. The ASEAN Free Trade Area have
little to no tariffs between member states. The lowering of tariffs have an impact on the
flow of goods in the market. Not only does it increase the number of goods coming into
the country but it also decreases the cost of these goods thus resulting in a better market
competition. Aside from tariffication, ASEAN Member Countries have also worked out
the elimination of nontariff barriers such as quotas and restrictive measures.
With this, the trade between ASEAN member countries is in upward trend. Reports
from the Management Information System and Technology Group shows Indonesia,
Vietnam, and Thailand are the top traders of the Philippines among the member
countries.
d. Post-Clearance Audit Group (PCAG) Reactivation
According to the Executive order, PCAG’s function is to conduct “within three years
from date of final payment of duties and taxes or customs clearance, an audit
examination, inspection, verification, and investigation of records pertaining to any
goods declaration, which shall include statements, declarations, documents, and
electronically generated or machine-readable data, for the purpose of ascertaining the
correctness of the goods declaration and determining the liability of the importer duties,
taxes and other charges, including fine and penalty.”
PCAG, formerly Post Entry Audit Group (PEAG) was formed in 2003 with the task to
audit goods that have secured clearance.
5. ANTI-CORRUPTION DRIVE
a. One-Strike Policy Approach
Despite giving everyone a clean slate, employees of the Bureau of Customs were
warned of the new policy implemented by the new Customs Commissioner Isidro
Lapeña – those who are found guilty of corruption will be immediately removed or
relieved from post in line with the one strike policy.
In 2017, a total of 641 employees were affected by the one strike policy; 49 of which
were relieved from their post.
Aside from the regular reshuffling of personnel, the Bureau of Customs stepped up its
drive against corruption by investigating 85 cases which stemmed from anonymous
complaints against BOC personnel, stakeholders and other entities who had transactions
with the bureau.
b. Tax Credit Certificates
A total of 108 Tax Credit Certificates with a total amount of P2,630,589,740.06 and 35
Cash Refunds with a total amount of P965,752,526.95 were awarded by the Bureau to
its stakeholders. Utilization of TCCs through issuance of Tax Debit Memos totalled to
P6,688,083,228.23.
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TCCs are documents issued by BOC or issued jointly by BOC and Department of
Finance to refund taxes paid by big companies for cases of excess duties, cancelled
importation, or due to VAT input, or output tax.
c. BOC caring through BOC cares
The creation of BOC-CARES is aimed at enhancing the positive reputation of the BOC
through an ensured continuous facilitation of customs service management. Moreover,
it seeks to foster harmonized information exchange with other government agencies, as
well as proper dissemination of public information through the use of modern
technology.
In 2017, statistics show that there were a total of 73,189 inquiries that were received
and resolved by the customer service representatives.
The top five concerns of the stakeholders are Electronic to Mobile, National Single
Window (NSW), documentation and procedures, parcel tracking, and accreditation.
The top concern, 29% of the 73,189 inquiries, is the E2M where importers and brokers
verify the entry status. In case of phone inquiries, NSW and accreditation requirements
topped the list.
d. Online Scam: Victims of fake love
Despite the readiness of the Bureau of Customs to provide assistance to the victims,
there is no willingness to cooperate on part of the victims perhaps due to
embarrassment. As a result, no complainant has ever filed a case at the National Bureau
of Investigation or at the PNP-Anti Cybercrime Division.
With this, the Bureau of Customs has been doing a massive information campaign to
inform the public of the increasing incidents of love scam and how to spot scammers to
avoid getting hooked. We have been sending advisories to the public to verify with
BOC CARES once they receive suspicious messages or information asking payment
for the release of their parcel. They can reach the BOC helpdesk via email at
boc.cares@customs.gov. ph, via telephone call at 705-6000, or through Facebook at
@BureauOfCustomsPH.
e. BOC: Certified FOI-compliant
Free and easy access of information which concerns the public can lessen rooms for
corruption at the agency. All offices and ports are required to observe transparency in
the public service.
Every Filipino can now easily request information, official records, public records,
documents and papers pertaining to official acts, transactions or decisions, as well as
government research data used as basis for policy development.
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6. ENHANCED PERSONNEL INCENTIVES AND REWARD SYSTEM
The strength of an institution lies in its human resource. In the bureau’s effort to elevate the
morale of its employees, the Bureau of Customs has taken steps to empower its human
resource management and services. One of which is to prioritize promotion of personnel
who have not been promoted for more than 20 years. These employees have steadfastly
dedicated themselves in the call of duty; thus, their promotion serves as the best reward
they could have.
In addition, the Bureau continuously gives recognition to employees who perform their
duties with dedication and sincerity through commendation and awarding of a plaque of
appreciation. These awards are given to deserving employees, offices and ports who have
either reached or exceeded their target, or seized and apprehended illicit goods, and other
acts/services worthy of recognition.
The Bureau has also given priority on hiring applicants under contract of service who have
been with the Bureau. This action is also coherent with the President’s call to stop
contractualization.
In 2017, 561 employees were promoted while 30 were newly-hired.
On the other hand, persons under contract of service with derogatory reports were
immediately terminated while non-performing employees were relieved from their posts
and were reassigned.
To improve the inspection proficiency of the bureau personnel, the BOC conducted eight
sets of seminars and trainings on X-ray Operations and Image Analysis.
Various seminars on Integrity, Transparency and Accountability (ITAPS) were conducted

in different ports and sub-ports of the Bureau of Customs to promote good governance and
high standard of ethics among Customs personnel. The ITAPS is a project initiated by the
Office of the Ombudsman.
Several Customs personnel also attended various CSC seminars on Collective Strategic
Performance Management System conducted at various ports. The discussion on SPMS is
significant in improving the collective performance within the bureau and strengthening
the culture of performance and accountability among employees.
The Bureau of Customs continue to implement programs, activities and events needed for
the improvement of employees’ knowledge, skills, and proficiency on various aspects of
Customs administration.
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BUREAU OF INTERNAL REVENUE

CY 2017 Major Accomplishments
1. ATTAIN COLLECTION TARGETS
a. Run After Tax Evaders Program
In 2017, a total of one hundred twelve (112) cases were filed with the Department of
Justice, with estimated tax liabilities of P40.948 Billion.
b. Oplan Kandado Program
The Oplan Kandado Program has served as an enforcement tool of BIR to strictly
impose prescribed administrative sanctions for non-compliance with the basic tax
requirements. Pursuant to Revenue Memorandum Order (RMO) No. 3-2009, business
operations can be suspended and temporarily closed for any of the following grounds:
1.) failure to issue receipts or invoices by a VAT-registered or registrable taxpayer; 2.)
failure to file a VAT return; 3.) understatement of taxable sales or receipts by 30% or
more of the correct amount thereof in the case of a VAT registered or registrable
taxpayer; or 4.) failure to register.
The Bureau generated collection for the year amounting to P296.947 Million and
closure of 141 business establishments nationwide.
c. Comprehensive Taxpayers Profiling and Industry Benchmarking
The following benchmarking activities were undertaken:

 Completed the updated taxpayers Philippine Standard Industrial Classification
(PSIC) based on the revised industrial standard classification (2009 PSIC/actual
activities including the 500+ newly enlisted large taxpayers from a more
accurate benchmark rate by industry.
 Completed the 2016 data profiling (including ITR Form 1702/2550Q) needed
for the computation of benchmarking rates.
 Computed the Benchmark rate for 2016 per
major industry for review/validation.
d. Updating of Schedules of Zonal Values
Objective of the Program is to update/revise the

existing schedule of Zonal Valuation to reflect the
current real property valuation, taking into account
the most recent actual sales/ transfers/ exchanges of
properties. The zonal valuation of the following
twenty-three (23) Revenue District Offices (RDOs)
has already been revised and made effective:
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e. Broadening of the Tax Base
Through the conduct of the Tax Compliance Verification Drives (TCVD) nationwide
and third party information (e.g. government-regulated agencies), the Bureau was able
to collect P252.058 Million and visited a total of 176,743 business establishments.
f. Internal Revenue Stamps Integrated System for Tobacco Products
For the period July 2014 to December 31, 2017, a total of 14.296 Billion stamps were
ordered which generated P370.511 Billion excise tax collection.
g. VAT Audit Program
From the commencement of the pilot implementation until December 31, 2017, the
VAT Audit Program in the four (4) Metro Manila Regions and LTS contributed to
deficiency collections of P11.286 Billion and deficiency assessments amounting to
P33.475 Billion.
h. Centralized Arrears Management Project
This creation of Arrears Management Team (AMT), which is composed of a pool of

Seizure Agents (SAs) in each of the four (4) Metro Manila Regional Offices, was
authorized by the former Commissioner to pilot the centralized administration and
management of Accounts Receivable (AR) Delinquent Accounts (DAs) at the Regional
Collection Divisions in Metro Manila; and its pilot operations commenced last March
2013. The highlights of the progress reviews of AMT pilot implementation in the four
(4) Metro Manila Regional Offices resulted to its expansion to additional two (2)
Regional Offices outside Metro Manila, RR Nos. 4-San Fernando, Pampanga and 9-
San Pablo City beginning January 2015.
The project resulted to the institutionalization of AMS nationwide and it was made
operational in seventeen (17) Revenue Regions (RR), namely: RR Nos. 1-Calasiao,
Pangasinan, 2-Cordillera Administrative Region (CAR), 3-Tuguegarao, Cagayan, 4-
San Fernando, Pampanga, 5-Caloocan City, 6-City of Manila, 7-Quezon City, 8-Makati
City, 9A-CaBaMiRo, 9B-LaQueMar, 10-Legazpi City, 11-Iloilo City, 12-Bacolod City,
13-Cebu City, 14-Tacloban City, 16-Cagayan de Oro City and 19-Davao City. Target
date of AMS implementation in RR Nos. 15-Zamboanga City, 17-Butuan City and 18-
Koronadal is on January 3, 2018. For the year 2017, total collections from tax arrears
has amounted to P6.52 Billion.
Seven (7) titles were consolidated in the name of the Republic of the Philippines.
i. Case Management System
The Case Management System (CMS) was rolled out in RR 8-Makati City and LTS. It
is a facility that enables creation, viewing and management of cases. It also provides a
facility for generating reports related to the cases created, either manually or via audit
selection. This year, the Bureau generated collection data for all RDOs under RR 8-
Makati City from eTIS-CMS amounting to P415.25 Million from 480 CMS cases
issued.
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j. International Tax Commitments: Continuing International Cooperation in Tax

Transparency and Collaboration among Tax Administrations
The EOI Program and International Tax Cooperation are badges of tax transparency
and continuing effort of tax administrators to combat cross-border tax fraud and
evasion. The EOI Program is divided into three (3) projects, which include: 1) EOI on
Request (EOIR); 2) FATCA; and 3) Automatic Exchange of Information/Common
Reporting Standards (AEOI/CRS). Project accomplishments this year are as follows:
EOIR
 PRG Assessors came to the Philippines for the 2nd Round of Peer Review last
11-14 December 2017. This review by the Global Forum aims to assess the
practical implementation of the Philippines on the international standards on
transparency and EOIR for the period of 1 April 2014 to 31 March 2017 under
the new Terms of Reference (TOR), as approved by the Global Forum on 29-30
October 2016;
 The EOI Unit of ITAD, working under the Commissioner of Internal Revenue, as
the Philippine EOI Competent Authority, extensively prepared for the On-site
visit; and
 Coordinated with other government agencies in preparation for the Philippine
defense in June of 2018.
FATCA, AEOI/CRS
 Coordinated with the Department of Finance in securing the requisite Senate
concurrence on FATCA-IGA 1 and the Multilateral Convention on Mutual
Administrative Assistance in Tax Matters;
 Deliberations by the Bids and Awards Committee on FATCA and AEOI IT
solutions.
On International Tax Cooperation, the Philippine Bureau of Internal Revenue have two
(2) commitments: 1) the Study Group on Asian Tax Administration and Research
(SGATAR); and the ASEAN Forum on Taxation (AFT).
SGATAR
The Philippines, as one of the founding members of SGATAR, supports its mission of
providing a platform to enhance the performance of tax administrations in the Asia-
Pacific region by promoting collaboration and communication among member tax
administrations. The Philippines hosted the 47th SGATAR Annual Meeting last 27-29
November 2017 at the Shangri-La Boracay Resort and Spa. The SGATAR Working
Groups discussed the following topics:
 Transfer Pricing: Issues on High-Risk Transactions Common in the Southeast
Asian Region and Other Developing countries;
 Information Management and Utilization: Business Intelligence and Proper Data
Mining, Evaluation and Utilization; and
 Human Resources in Tax Administration: Compensation, Benefits and Career
Development of Personnel in the Tax Administration System.
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AFT
The AFT was created to serve as mechanism to address tax-related problems and
policies pertaining to regional economic integration. It builds on a mandate given by
the ASEAN Finance Ministers in April 2010 to form a working group on taxation, as
well as to strengthen cooperation in taxation matters among ASEAN countries.
 Concluded the pre-negotiation meeting with Cambodia last 14-15 December 2017
in Phnom Penh, Cambodia; and
 Scheduled the first-round of negotiation with Cambodia in June 2018
2. IMPROVE TAXPAYER SATISFACTION
a. eBIR Forms
The eBIR Forms Package was enhanced to improve its functionality making it easier
for taxpayers to download, prepare tax returns and submit online.
As of December 2017, there are already 15,032,711 tax returns filed through eBIR
Forms, an increase of 13.5% compared to CY 2016.
b. Review of Tax Rulings
The objective of this program is to review and revoke tax rulings/decisions which
hinder business transactions. Out of 6,014 dockets received by Legal Service, 5,287
has been reviewed and acted upon for this year.
c. Taxpayer Segmentation
RMO No. 17-2017 was issued on July 17, 2017, prescribing the policies and procedures
in monitoring the compliance of Top Taxpayers classified as Medium taxpayers in RRs.
The Regional and National Monitoring Team (RMT/NMT) was created through
issuance of RSO No. 812-2017, establishing a system to monitor and improve
compliance of top taxpayers in twelve (12), namely: RR Nos. 1-Calasiao, Pangasinan,
4-San Fernando, Pampanga, 5-Caloocan City, 6-City of Manila, 7- Quezon City, 8-
Makati City, 9A-CaBaMiRo, 9B-LaQueMar, 12-Bacolod City, 13-Cebu City, 16-
Cagayan de Oro City, and 19-Davao City.
The RRs conducted the Taxpayer Segmentation Forum for their respective Top 500
Taxpayers classified as Medium Taxpayers.
d. Additional Options/Facilities for Payment of Taxes
This project provides taxpayers with additional options or facilities to pay taxes through
the use of their credit/ debit/prepaid cards and mobile phones through ePayment
channels of AABs.
Last October 2017, Landbank of the Philippines (LBP) and Development Bank of the
Philippines (DBP) launched their ePayment System and DBP PayTax online payment
facilities where taxpayers can pay using Credit (Visa/Mastercard) and Debit/ATM
(BancNet/LBP) Cards.
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As of December 2017, a total of 37,826 transactions were made through Debit/Credit

Cards and GCash which resulted to P61.275 Million tax payment collection.
e. Expansion of ISO Certification to other districts
The BIR is continuously embarking towards the improvement of its frontline services
and strengthening its collection efforts which include the enactment of the Citizen’s
Charter. This project adheres to the objective of the Anti-Red Tape Act, which is to
promote transparency in government with regards to the manner of transacting with the
public by simplifying frontline service procedures and documentary requirements The
following were the CY 2017 highlights of activities:
 The BIR Commissioner signed a follow-up memorandum with the Development
Academy of the Philippines (DAP) for the assistance in the transition of ISO
9001:2015;
 A Memorandum dated August 25, 2017 on decentralization of the training on ISO
9001:2015 Quality Management System (QMS) of RR No. 7 was approved and
signed by ACIR Marilou del Rosario;
 A third-party 3rd cycle audit was conducted on September 11 to 15, 2017. All
RDOs and support offices under RR No. 7 successfully obtained the re:
certification of ISO 9001:2008 QMS with No Non Compliance;
 Training and gap analysis in RDO No. 58-Batangas City was conducted; and
 Certified true copies of ISO 9001:2008 Certificates of all RDOs under RR 7-
Quezon City were transmitted thru DBM Secretariat-Systems and Productivity
Improvement Government Quality Management Committee pursuant to RMO No.
13-2017.
f. Public Awareness Campaign
The 2017 National Tax Campaign Kick-off was formally launched on February 3, 2017
at the National Training Center Auditorium with the theme “BIR: Tunay na Pagbabago,
Para sa Bayan”. It also re-launched the BIR’s Social Media (Facebook, Twitter, and
Google+), the continuing expansion of the RDO eLounge facility, the email complaint
(eComplaint) facility, and the Globe Cash (Gcash) as an additional mode of payment.
Regional and District campaigns were also conducted from February 3 to March 30,
2017. Likewise, the LTS launched its tax campaign at the Philippine International
Convention Center (PICC) dubbed as “Ako, Kaisa sa Pagbabago,” unveiling the thrust
of the LTS to attain its collection target, as well as to improve taxpayer service in
keeping with President Duterte’s call for change, which he made during his inaugural
speech.
Tax campaign collaterals like T-shirts, caps, ballpens, tarpaulins, and flyers were
provided by the Client Support Service for uniformity and consistency.
The knowyourtaxes.ph website was also utilized, with the support of the USAID, for
the promotion of the eBIR Forms and GCash mode of payment.
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g. Electronic Services
 Electronic Tax Information Systems

The Electronic Tax Information System (eTIS) is a major Information and
Communications Technology (ICT) undertaking intended to enhance/improve the
BIR core Tax Administration System, by providing a single, web-based automated
solution.
The implementation of eTIS at the pilot sites is one of the stages in system
development life cycle where the issues are identified and fixed within the warranty
period. Enhancements are always underway to come out with a tool that will
support the revenue generation and tax administration.
For CY 2017, the Contractor conducted a site visit to LTS and RDO 50-South
Makati.
 In-house Enhancement of Electronic Certificate Authorizing Registration

(eCAR) System
The eCAR System facilitates the generation of the eCAR by encoding the details of
validated and approved transactions. eCAR has been rolled-out and fully
implemented nationwide through linkage with the Land Registration Authority
(LRA) using the eCAR Verification System.
The eCAR is a document being issued by the BIR, certifying that the corresponding
tax for the transfer of real property has been paid by the concerned parties. Without
the eCAR, the Registry of Deeds will not issue a new title to effect the transfer of
ownership of the subject of property.
Due to failed bidding in December 2017, minor enhancement of the system was
requested for inclusion in the pipeline of Change Request (in-house enhancement).
 Electronic Registration
This Electronic Registration System (eREG) serves as a convenient tool, not only
for taxpayers who are filing their applications for TIN online, but also for the
Revenue District Offices (RDOs) seeking to minimize their backlog on TIN
applications. There were 17,240 TINs thru eREG/DTI-PBR, issued for this year.
Also, Functional Specification Requirements were revisited/reviewed, together
with the process owner and provider.
 Electronic Filing and Payment System
The use of Electronic Filing and Payment System (eFPS) was made mandatory to
Large Taxpayers, Taxpayer Account Management Program (TAMP) taxpayers,
those required to secure the BIR - Importers Clearance Certificate (ICC) and BIR
- Brokers Clearance Certificate (BCC), National Government Agencies (NGAs),
Licensed Local Contractors, Enterprises enjoying Fiscal Incentives, Top 20,000
Private Corporations, Top 5,000 Individual Taxpayers, Corporations with paid-up
Capital Stock of P10 Million and above, Corporations with complete Computerized
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Accounting System, Government Bidders, Insurance Companies and Stockbrokers

and Procuring Government Agencies with respect to withholding of Value-Added
Tax (VAT) and Percentage Tax. Through the eFPS, taxpayers are allowed to avail
of the paperless tax filing experience and made to pay their taxes online through the
convenience of an internet banking service via debit from their enrolled bank
account.
 Electronic Official Registry Book for Tobacco Products
The Electronic Official Registry Book (eORB) is a system wherein the tobacco
industry will be able to submit electronically ORBs of daily transactions of receipts
and removals of regulated raw materials, goods-in-process, and finished products
to BIR. It will also monitor submissions to uncover discrepancies on declarations.
This system will generate ORB forms, submission compliance report, discrepancy
reports, and collection reports.
 Electronic Authority to Release Imported Goods
The Electronic Authority to Release Imported Goods (eATRIG) System provides

an online application for eATRIG using the National Single Window (NSW)
System of the Bureau of Customs. An eATRIG shall be issued by the BIR to all
importation of articles subject to excise tax. No application for eATRIG shall be
processed if the importer-applicant and/or broker representative is/are not duly
registered taxpayers of the BIR. The Bureau processed and issued 27,394 ATRIGs
through the NSW facility which generated an excise tax collection of P62.174
Billion.
 Electronic Letter of Authority Monitoring System
The Electronic Letter of Authority Monitoring System (eLAMS) is a web-based

application designed to provide the BIR a means to automate the issuance and
monitoring of electronic Letters of Authority (eLAs), including control of
workload, across all concerned BIR offices from the time of issuance until the
termination/closure of cases.
For this year, the Bureau generated a collection amounting to P13,106.75 Million
from 18,795 eLAs issued, nothwithstanding date of issuance.
 Establishment of eLounge in District Offices
The eLounge facilities were established to provide taxpayers with a venue where
they can access and use the BIR eServices. The taxpayer service efficiency of the
Bureau has greatly improved through the utilization of this facility. Also, the
maximum utilization of the eLounge helped in the immediate recognition of
collections and data/information that goes into the database as soon as the
transaction is done.
As of December 2017, one hundred fifteen (115) eLounge facilities are already
established and operationalized nationwide.
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 Centralization of Document Processing in the Regional Offices
The Document Processing Divisions (DPDs) monitors the centralization of

document processing in the Regional Office, formulates and implements the
policies, guidelines, processes and procedures that would promote efficiency and
effectiveness of its functions.
The DPDs are categorized into two levels: i) Level 1 – tax returns are processed
and encoded manually; and ii) Level 2 – returns are scanned prior to encoding.
The DPDs were established and made operationalized in twenty (20) RRs, sixteen
(16) of which are under Level 1 and four (4) DPDs are under Level 2.
3. PROTECT REVENUES AND RECAPTURE PUBLIC TRUST
A Special Disciplinary Committee was created to look into the cases of revenue officers
who failed the test of integrity, competency, and efficiency in the performance of their audit
functions and consequently, shall impose the appropriate sanctions. The Committee
conducted a nationwide revalidation to verify the replies of the Revenue Officers to the
formal charges issued against them.
To further strengthen the disciplinary arm, the Internal Affairs Service was specifically
ordered to expedite resolution of administrative complaints against erring personnel, to wit:
a. Data Privacy Act
Republic Act 10173 was enacted for the purpose of protecting the privacy of individuals
while ensuring free flow of information to promote innovation and growth; and
regulating the collection, recording, organization, storage, update or modification,
retrieval, consultation, use, consolidation, blocking, erasure or destruction of personal
data.
The National Privacy Commission spearheaded the aggressive implementation of the
provisions of Republic Act 10173 thru its Implementing Rules and Regulations. Taking
cue, BIR similarly embarked on complying with the law, starting off with initiating
changes on how BIR handles and secures personal data on a daily/routine basis.
Revenue Special Order No. 395-2017 (dated May 15, 2017) formalized the creation of
the BIR Data Privacy Committee, with the Deputy Commissioner of the Information
Systems Group as the BIR Data Protection Officer (DPO). Similarly, the Chief of Staff
629
for Administrative Concerns – Office of the Commissioner, the Regional Directors and
the Revenue District Officers were assigned as Compliance Officers for Privacy (COP).
In addition, various teams were created to facilitate conformity with the Five (5) Pillars
of Data Privacy Accountability and Compliance.
Initial efforts to drum up data privacy awareness covered – Privacy Notices posted in
the BIR Website and reflected in attendance sheets; Privacy Impact Assessment of
highly sensitive BIR systems; Data Privacy Act Briefing conduct in various BIR
offices; and Development/formulation of standards, guidelines and procedures for
information security and physical security, among others.
b. Civil Service Commission Program to Institutionalize Meritocracy and Excellence

in Human Resource Management (CSC PRIME-HRM
The BIR was awarded a Certificate of Recognition for obtaining Maturity Level 2 in
Recruitment; Selection and Placement; Performance Management; Learning and
Development; and Rewards and Recognition, as a result of the HR officers’ and staff’s
determination and invaluable efforts to promote people excellence in the BIR to
efficient and effective public service delivery. A Level 2 Accreditation Status grants
the BIR the authority to take final actions on appointments. The assessment of the CSC
aims to elevate the public sector human resource management to a level of excellence
through the process of assessment, assistance and recognition.
A Revalidation of the Enhanced Level 2 Status was conducted by the CSC last
November 2017 with results pending announcement.
c. Human Resource Information System/ Comprehensive Human Resource

Information System
The establishment of a modern, fully automated Human Resource Information System

(HRIS) will allow better utilization and management of BIR staff. It supports the
requirements of the Civil Service Commission (CSC) Program to Institutionalize
Meritocracy and Excellence in Human Resource Management (PRIME-HRM) and
provide the revenuers with fast and easy access to comprehensive and integrated human
resource data.
For 2017, the database build-up of HRIS is ongoing, of which, 88.78% or 9,288 out of
10,462 employees’ leave credits have already been updated/reconciled.
630
d. Expedite Recruitment of Personnel
This year, the target of the

Bureau to fast-track the
recruitment is nine
hundred ninety-six (996)
new staff for all
offices/units. An authority
for recruitment was
delegated to the Regional
Offices thru RMO No. 68-
2016 dated December 6, 2016 in order to meet the target. Below is the statistics of the
Bureau’s recruitment:
e. Improved Training Management Systems
For the continuous improvement of the Bureau’s training management system, online
training evaluation method was initiated in 2017. The Training Management Division
facilitated two (2) on-line evaluations for Personnel Orientation Course (POC) and
Basic Tax Administration Course (BTAC).
Follow-through evaluations on the eCAR training series were conducted on RR Nos.

10-Legazpi City, 13-Cebu City, and 19-Davao City on September 14, 19 and 26, 2017,
respectively. The eCAR follow-through evaluation was part of the Training Monitoring
and Evaluation Process of the TMD to find out how the learning intervention on eCAR
has been applied in the workplace and establish opportunities for improvement of future
trainings.
f. Gender and Development (GAD)
The GAD Focal Point System (GFPS) members strengthened their skills set through a
series of capacity-building programs for the national and regional GFPS. The programs
aim to continuously increase gender awareness among the employees:
1. Gender Sensitivity Trainings (GST) – This training is designed to create gender
awareness among officials and employees. All GST conducts were facilitated
and conducted by Dr. Rowena S. Navera, an accredited member of the National
GAD Resource Pool of the Philippine Commission on Women (PCW). One
hundred ninety-seven (197) male and three hundred sixty-seven (367) female
employees attended the GST.
2. A three-part series training-workshop to financially empower BIR employees

towards financial freedom entitled SHEconomics was conducted as part of the
2017 National Women’s Month Celebration. Said training-workshop discussed
the fundamental, intermediate and advanced techniques and approaches to
manage finances such as savings and investments. Twenty-four (24) men and
ninety (90) women employees attended the trainings facilitated by Mr. David
Isaiah Angway, a Registered Financial Planner, CEO and Founder of
WinLongTerm Financial Consultancy on:
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3. Three (3) planning sessions and general assemblies of the BIR GAD Focal Point
System to formulate the BIR GAS Strategic Framework, Five-Year GAD Agenda,
and GAD Planning and Budgeting for CY 2019-2023. These assemblies were
co-sponsored by RR Nos. 4-San Fernando, Pampanga, 2-CAR and 19-Davao
City.
4. On-the-Job (OJT) Training Workshop Focusing on Sexual Harassments was
conducted by the Personnel Division in coordination with the TMD. Selected
GAD Focal Point System members and HR personnel from the National and
Regional Offices were oriented on the policies, guidelines and procedures in
accepting students for the OJT in the BIR.
5. Continuing Learning on GAD through Film Showing – Two hundred twenty
(220) employees from National Office watched the documentary film, “Walang
Rape sa Bontoc”, directed by Mr. Mark Lester Valle and recommended by the
PCW. The file is about two (2) Filipinas, both victims of sexual abuse in
varying degrees, who yearn and search for a utopia where women can live
without being sexually violated. They accidentally encountered a study
renowned anthropologist June Prillbrett, PH.D., which states that the Bontok of
the Philippine Cordilleras has lived for eras without a term, concept, nor incidence
of rape.
6. Reproduced and distributed IEC materials recommended by the PCW in the
National Office:
a. Republic Act (RA) No. 7877 – Anti-Sexual Harassment Act of 1995 flyers
b. RA No. 9208 – The Human Trafficking in Persons Act of 2003 as amended
by RA No. 10364 of the Expanded Anti-Trafficking in Persons Act of 2012
flyers
c. RA No. 9262 – Anti-Violence Against Women and Their Children Act of
2004 flyers
d. RA No. 8353 – the Anti-Rape Law of 1997 flyers
7. Capacity Development of the Regional GAD Focal Point System (GFPS):
Training on GAD Planning and Budgeting, Gender Analysis using Gender
Mainstreaming Evaluation Framework (GMEF) and Harmonized Gender and
Development Guidelines (HGDG) for RR Nos. 9A-CaBaMiro,9B-LaQueMar,
11- Iloilo and 19-Davao City – conducted from May to November 2017 to equip
the GFPS members with the knowledge on GAD Planning and Budgeting,
Gender Mainstreaming and Gender Analysis (GA). They were also oriented on
the use of GA tools to be able to identify gender issues and to come up with
programs and activities to address the issues.
632
BUREAU OF THE TREASURY

CY 2017 Accomplishments
1. Raised financing to meet requirements at cost-efficient means
The Bureau of the Treasury was strategically able to raise financing at favorable interest
rates by tapping ample domestic liquidity as well as global capital markets.
For 2017, the National Government (NG) raised P901.7 billion in gross financing, to cover
the budget deficit of P350.6 billion for the year and refinancing requirement of P369.9
billion inclusive of the P58.0 billion used to buy back outstanding expensive debt. Actual
gross financing is higher than the revised full year program of P727.7 billion, mainly due to
the issuance of Retail Treasury Bonds twice this year, taking advantage of the ample
liquidity in the market and in support for the infrastructure projects of the current
administration.
NATIONAL GOVERNMENT FINANCING

For the Period Indicated
(In million pesos)
2017 2017
Revised 2017 Actual Diff
1/
Program 2/
Particulars Program %
NET FINANCING 542,009 584,780 758,929 174,149 29.8%

External Borrowing (Net) 42,777 43,170 27,569 (15,601) -36.1%
External Borrowing (Gross) 126,259 182,770 168,103 (14,667) -8.0%
Project Loans 34,080 30,300 33,424 3,124 10.3%

Program Loans 68,179 42,470 35,113 (7,357) -17.3%
Bonds and Other Inflows 24,000 110,000 99,566 3/ (10,434) -9.5%
Less: Amortization 83,482 139,600 140,534 4/ 934 0.7%
Domestic Borrowing (Net) 499,232 541,610 731,360 189,750 35.0%

Domestic Borrowings (Gross) 505,035 544,969 733,569 188,600 34.6%
Treasury Bills 40,000 54,969 26,433 (28,536) -51.9%
Retail Treasury Bonds 0 0 437,103 437,103
Treasury Bonds 465,035 490,000 270,033 (219,967) -44.9%
Less: Net Amortization 5,803 3,359 2,209 (1,150) -34.2%

Amortization 232,987 230,543 229,392 (1,151)
o/w Serviced by the BSF 5/ 227,184 227,184 227,183 (1)
GROSS FINANCING 631,294 727,739 901,672 173,933 23.9%

Financing Mix (% of Total)
External 20% 25% 19%
Domestic 80% 75% 81%
1/ Based on BESF 2017 Table D.1
2/ Based on BESF 2018 Table D.1
3/ Includes proceeds used to prepay outstanding bonds in bond exchange transactions
4/ Includes prepayments made through bond exchange transactions
5/ Actual redemption from Sink ing Fund
Source: Bureau of the Treasury
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a. Sustained preference towards domestic financing. Issuance of domestic securities

remained the preferred mode of fundraising. Of the total amount, 81% or P733.6 billion
came from domestic lenders while P168.1 billion or 19% was raised externally through
availment of concessional loans from development partners and issuance of dollar
bonds in the international capital markets.
Domestic borrowings came from the proceeds from the auction of treasury bills and
bonds amounting to P733.6 billion. Gross treasury bills flotation totaled P291.1 billion
while redemptions amounted to P264.6 billion, leaving P26.5 billion for financing.
Meanwhile, the issuance of 3-, 5-, 7-, 10- and 20-year treasury bonds accounted for the
remaining P707.1 billion in domestic funding. Bulk of the treasury bonds issued in 2017
came from Retail Treasury Bonds (RTBs) which were issued in April and December.
Proceeds from the RTB issuance were also used to prefund the 2018 financing
requirements ahead of the expected increase in rates as central banks begin normalizing
policy rates in 2018.
On the other hand, bulk of the external gross borrowings came from the issuance of
USD2.0 billion (P99.6 billion) Global Bonds in February and loan availment from the
Asian Development Bank (ADB) and the International Bank for Reconstruction and
Development (IBRD), specifically: (1) USD250 million or P12.7 billion from ADB’s
Local Government Finance and Fiscal Decentralization Reform Project and (2)
USD220 million or P10.9 billion from IBRD’s Philippine Social Welfare Development
and Reform Project.
b. Enhanced access to retail investors and mobilizing domestic savings. The Bureau
issued two tranches of retail treasury bonds, which served to (1) deepen local debt
markets and reduce exposure to foreign exchange risk while (2) providing an affordable,
risk-free investment to average Filipinos. The 19th tranche of RTBs had a three (3)-year
tenor with a coupon of 4.250%, raising P181.0 billion, meanwhile, the 20th tranche
reached P255.4 billion with a five (5)-year tenor and coupon of 4.625%. Proceeds from
the RTB issuance were also used to prefund the 2018 financing requirements ahead of
the expected increase in rates as central banks begin normalizing policy rates in 2018.
c. Continued liability management through global bond issuance. The first

international capital market bond issuance (ROP) of the Duterte administration allowed
the Republic to switch out high-cost, relatively illiquid bonds, in favor of new issues
resulting in reduced financing costs and interest savings while extending the maturity
of the debt portfolio.
The 25-year ROPs reflected the country’s strong credit rating (at the time Baaa3/BBB-
/BBB-), having been priced at the tightest spread of 66.7 bps over US Treasuries — a
record low for the Republic and comparable to Aa2/AA+/AA+-rated borrowers. USD
2.0 billion in new bonds were issued at a coupon rate of 3.700%, with order books going
4.0x oversubscribed. Of the total, USD 1.5 billion was used for the debt exchange
lessening incremental debt.
634
2. Improved profile of outstanding debt1
Financing operations were carried out in line with cost and risk management parameters.
The resulting structure and characteristics of NG’s debt portfolio maintains a prudent
exposure to market risks consistent with debt sustainability objectives.
a. Mitigating forex risk exposure through preference for domestic financing. Most
obligations are still Peso-denominated at 68.34% of the total, slightly up from 66.32%
in 2016. This moderates the impact of forex fluctuations on outstanding obligations as
well as interest payments.
b. Contributed to fiscal sustainability by managing borrowing costs. Despite a rising

interest rate environment, the weighted average interest rate (WAIR) for total NG Debt
has remained low and stable at 4.89% in 2017 from 4.99% at the end of last year. Over
the same period, the WAIR for domestic borrowings has gone down to 5.13% from
5.24% while that for foreign financing was at 4.41% from 4.54%. This was achieved
through a strategic borrowing approach that took advantage of favorable rates.
These gains are reflected in interest payments (IP) as a percentage of revenue and
expenditures. Total IP, for January-December 2017 accounted for 12.6% and 11.0% of
revenue and expenditure, respectively, improving from previous year levels of 13.8%
and 12.0%. As of end-December, NG IP savings amount to P24.3 billion versus
program.
c. Refinancing risk maintained at low levels. Average NG debt maturity of 9.80 years
has been maintained at the upper bound of the 7-10 year strategic target, having started
the year at 10.05. Domestic and external debts have remaining maturities of 7.75 and
12.05 years, respectively.
Moreover, only 8.31% of the total debt portfolio is subject to resetting. This limits the
sensitivity of interest payments to volatile market conditions.
d. Continued sustainability of NG debt. NG Debt as a proportion of GDP has sustained

its level at 42.1% against the initial target of 40.7% presented to the Development
Budget Coordination Committee (DBCC) in June 2017.
Net of pre-funding for 2018, the debt-to-GDP ratio settles at even a lower level of
40.5%, hitting and maintaining the downward trajectory set in the medium-term
program.
3. Implemented reforms to improve the efficiency of local debt markets
Key initiatives were launched to deepen the domestic debt market and enhance price
discovery.
a. Enhanced GSEDs Program. This program imposes obligations and privileges to

Government Securities Eligible Dealers (GSED)-Market Makers to stimulate market
activity and competitiveness in both the primary and secondary GS markets.
1
Based on latest available debt and financing data as of end-December 2017.
635
b. Repurchase Agreement (Repo) Program. The inaugural repo trade was carried out
with the support of market stakeholders. The straight-through-processing repo trading
platform is expected to further add liquidity to local debt markets by providing credit
risk-free funding.
4. Strengthened cash and asset management
a. Better cash forecasting through improved coordination. The BTr expanded the
participation in its cash forecasting initiative, adding ten more National Government
Agencies (NGAs) to the initial Club of Ten. This is meant to further improve the
management of NG cash resources by more accurately anticipating funding
requirements. Regular coordination and monitoring is also done with the Department
of Budget and Management (DBM) through Cash Programming exercises.
b. Launch of Government Purchase Cards (GPC). The GPC pilot program was
initiated through the signing of a memorandum of agreement between the BTr, the
DBM and Land Bank of the Philippines in November 2017. The GPC is an alternative
mode of payment for goods and services that aims to reduce transaction costs by
limiting the frequency and amount of cash advances. It is a Government-to-
Government Contract with Land Bank through the subscription of a credit card
facility. The BTr and DBM will be the initial pilot agencies for the project before
eventually rolling out to other NGAs.
c. Establishment of a National Asset Registry. The National Asset Registry program

was launched to provide a comprehensive inventory of the non-financial assets of the
National Government. The registry will be available online, improving transparency,
accountability and the effective management of Government assets.
d. Improved returns on NG investments. The BTr successfully negotiated for more

favourable rates on balances held under the Treasury Single Account (TSA) with the
Bangko Sentral ng Pilipinas (BSP) starting December 2017. This is meant to
maximize returns on funds managed by the Bureau as part of its mandate.
e. Exceeded BTr income targets2. The Bureau of the Treasury (BTr) income reached
P99.9 billion for the year, overshooting the program by 71% although down by 2%
from P101.7 billion recorded a year ago.
2
Based on the Cash Operations Report as of end-December 2017.
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Comparative Table on Actual BTR Income vs. Program

For the Period January 01 to December 31, 2017
(In Million Pesos)
Jan 01 – Difference
Particulars Full Year Dec 31 (Actual vs. Percent
Program Actual Program) Change
A. BTR Income 31,099 39,379 8,280 26.62%

1. Interest Income on NG Deposits 1,600 3,790 2,190 136.88%
a. BSP 1,539 3,633 2,094 136.06%
b. Other Banks 61 157 96 157.38%
2. Interest on Advances to GOCCs 141 243 102 72.34%
3. Income from BSF/SSF 23,990 28,650 4,660 19.42%
4. Guarantee Fee 2,600 1,922 (678) -26.08%
5. Foreign Exchange Risk Cover Fee 1,650 1,720 70 4.24%
6. Government Service Income 1,118 3,054 1,936 173.17%
a. Fidelity Bond Premia 700 963 263 37.57%
b. Subscription Fee - RoSS Participants 11 12 1 9.09%
c. Escheat of Unclaimed Balances 100 110 10 10.00%
d. Service Fee on Relent Loans 307 670 363 118.24%
e. Others 0 1,299 1,299
B. NG Income Collected by BTR 27,483 60,526 33,043 120.23%

1. Dividends on Shares of Stocks 10,000 31,212 21,212 212.12%
2. NG Share in Airport Terminal Fee 578 973 395 68.34%
3. NG Share in PAGCOR Income 15,750 26,729 10,979 69.71%
4. NG Share in MIAA Profit 1,155 1,612 457 39.57%
C. TOTAL BTR INCOME 58,582 99,905 41,323 70.54%
The slowdown is due to lower income from Bond Sinking Fund (BSF)/Securities
Stabilization Fund (SSF) investments and NG deposits given diminished asset
holdings of the BSF and lower cash holdings and deposits, respectively. These were
partially offset by higher collection from PAGCOR and dividends on NG shares of
stocks. Compared to program, dividend collections (P31.2 billion), income from
BSF/SSF (28.7 billion) and NG share in PAGCOR income (P26.7 billion) contributed
the highest.
5. Implemented reforms in the management of contingent liabilities to reduce NG

exposure
The Bureau led two major initiatives in improving the management of contingent liabilities.
a. Consolidation of guarantee corporations under the umbrella of PhilEXIM. By

streamlining processes, the government hopes to eliminate redundant workstreams,
provide better services through more accurate valuation and pricing of guarantees, and
utilize government resources more efficiently. Currently, a draft Executive Order has
been recommended for the President's approval and signature.
b. Risk insurance for government assets. The government is in the process of

assembling a national registry of both physical and financial assets, with 0the end goal
of determining which assets should be insured and for which risks. This will allow the
government to manage its exposure with respect to critical infrastructure such as
public schools, hospitals, and roads, among others.
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ANNEXES
ANNEX A
LIST OF NGAs WHICH SUBMITTED THEIR FSs FOR FY 2017
National Government Agency Office Address
Office of the President

1 Office of the President Proper Malacañang Complex, J. P. Laurel St., San Miguel, Manila
2 Davao Integrated Development Program G/F JFM Coporate Center 848, Atis Street, Juna Subdivision,
Matina Davao City 8000
Office of the Vice President

3 Office of the Vice President Proper Quezon City Reception House, 100 10th Street, New Manila,
Quezon City
Department of Agrarian Reform

4 Office of the Secretary Elliptical Road, Diliman, Quezon City
5 Office of the Secretary Elliptical Road, Diliman, Quezon City
6 Agricultural Credit Policy Council San Miguel Avenue, Ortigas Center, Pasig City 1605
7 Bureau of Fisheries and Aquatic Resources 3F PCA Building, Vasra, Quezon City
8 National Meat Inspection Service BAI Compound, Visayas Avenue, Vasra, Diliman, Quezon
City
9 Philippine Center for Postharvest Development and Central Luzon State University (CLSU) Compound, Science
Mechanization City of Muñoz, Nueva Ecija
10 Philippine Council for Agriculture and Fisheries R-7, Diliman, Quezon City, Metro Manila
11 Philippine Fiber Industry Development Authority BAI Compound, Visayas Avenue, Vasra, Diliman, Quezon
City
12 Philippine Carabao Center Central Luzon State University, Philippine Carabao Center,
Executive Ave., Science City of Muñoz, Nueva Ecija
13 National Tobacco Administration Sct. Reyes cor Panay Ave., Quezon City
Department of Budget and Management

14 Office of the Secretary General Solano St., San Miguel, Manila
15 Government Procurement Policy Board-Technical 2506 Raffles Corporate Center, F. Ortigas Jr. Rd., Ortigas,
Support Office Pasig City
16 Procurement Service PS DBM Compound, RR Road, Cristobal St., Paco, Manila
Department of Education
17 Office of the Secretary DepEd Complex, Meralco Avenue, Pasig City
18 Early Childhood Care and Development Council 4/F Belvedere Tower, No. 15 San Miguel Ave., Ortigas
Center, Pasig City
19 National Council for Children’s Television 4/F Bonifacio Bldg., DepEd Complex, Meralco Avenue,
Pasig City
20 National Book Development Board Unit 2401 Prestige Tower, F. Ortigas Jr. Road (formerly
Emerald Ave., Ortigas Center, Pasig City 1605)
21 National Museum Executive House Bldg., P. Burgos St., Taft Ave., Manila
22 Philippine High School for the Arts National Arts Center, Mt. Makiling, Los Baños, Laguna
Department of Energy
23 Office of the Secretary 2F PNOC Bldg. V, Energy Center, Rizal Drive, 34th St.,
Taguig City
Department of Environment and Natural Resources

24 Office of the Secretary Visayas Avenue, Diliman, Quezon City 1100
25 Environmental Management Bureau DENR Compound, Visayas Avenue, Diliman, Quezon City
26 Mines and Geo-Sciences Bureau Vasra, Diliman, Quezon City
27 National Mapping and Resources Information Authority Lawton Avenue, Fort Andres Bonifacio, Taguig 1634
28 National Water Resource Board 8/F, NIA Building, EDSA, Diliman 1101
29 Palawan Council for Sustainable Development Staff PCSD Building Sports Complex Road, Sta. Monica Heights,
Puerto Princesa City, Palawan
Department of Finance
30 Office of the Secretary 6/F DOF Bldg., Roxas Blvd. cor. Pablo Ocampo St., Manila
31 Bureau of Customs Bureau of Customs Bldg., Port Area, South Harbor, Manila
32 Bureau of Internal Revenue Rm. 405, BIR National Office Bldg., Diliman, Quezon City
33 Bureau of Local Government Finance 8/F EDPC Bldg., BSP Complex, Roxas Blvd., Manila
34 Bureau of the Treasury Ayuntamiento Bldg., Soriano Ave., Intramuros, Manila
35 Central Board of Assessment and Appeals 7/F EDPC Bldg., BSP Complex, Roxas Blvd., Manila
36 Insurance Commission 1071 United Nations Avenue, Ermita, Manila
37 Municipal Development Fund Office Podium Level, DOF Executive Building, Roxas Boulevard
corner Pablo Ocampo Sr. Street, 1004
638
38 National Tax Research Center Harbor Centre II, 23rd cor. A. C. Delgado St., Port Area,
Manila
39 Privatization Management Office 3/F North Davao Mining Corp. Bldg., 104 Gamboa St.,
Legaspi Village, Makati City
40 Securities and Exchange Commission SEC Main Office Secretarial Bldg., PICC Complex, Roxas
Blvd., Pasay, Metro Manila
Department of Foreign Affairs

41 Office of the Secretary 2330 Roxas Blvd., Pasay City
42 Foreign Service Institute 5/F DFA Bldg., 2330 Roxas Blvd, Pasay City
43 Technical Cooperation Council of the Philippines 6/F DFA Bldg., 2330 Roxas Blvd, Pasay City
44 UNESCO National Commission of the Philippines Ground Flr. DFA Bldg., 2330 Roxas Blvd, Pasay City
Department of Health
45 Office of the Secretary San Lazaro Compound, Rizal Avenue, Sta. Cruz, Manila
46 Commission on Population Senator Neptali A. Gonzales Street, Welfareville Compound,
Mandaluyong, Manila, Metro Manila
47 National Nutrition Council Nutrition Bldg., 2332 Chino Roces Ave., Taguig City
Department of Information and Communications Technology

48 Office of the Secretary NCC Bldg., Carlos P. Garcia Ave., Diliman, Quezon City
49 National Telecommunications Commission Agham Road, East Triangle, Diliman, Quezon City
50 National Privacy Commission 3/F, Core G, GSIS HQ Bldg., Financial Center, Pasay City,
Metro Manila 1308
Department of the Interior and Local Government

51 Office of the Secretary DILG-NAPOLCOM CENTER, EDSA cor. Quezon Avenue,
Quezon City
52 Bureau of Fire Protection Agham Road, Sitio San Roque, Brgy. Bagong Pag-Asa,
Quezon City
53 Bureau of Jail Management and Penology 144 Mindanao Ave., Quezon City
54 Local Government Academy 8/F & 9/F Agustin I Bldg., F. Ortigas Jr. Road Ortigas
Center, Pasig City
55 National Police Commission DILG-NAPOLCOM Center, EDSA cor. Quezon Avenue,
Quezon City
56 Philippine National Police PNP National Headquarters Camp General Crame, Quezon
City
57 Philippine Public Safety College 505 Al-Fer Building, B. Serrano Avenue corner EDSA,
Quezon City
Department of Justice
58 Office of the Secretary DOJ Building, Padre Faura St., Ermita, Manila 1004
59 Bureau of Corrections NBP Reservation, Muntinlupa City
60 Bureau of Immigration 2/F BOI Bldg., Magallanes Drive, Intramuros, Manila
61 Land Registration Authority NIA Road cor. East Ave., Diliman, Q. C.
62 National Bureau of Investigation NBI Bldg., Taft Avenue, Ermita, Manila
63 Office of the Government Corporate Counsel 3/F MWSS Admin. Bldg., Katipunan Road, Balara, Quezon
City
64 Office of the Solicitor General OSG Bldg., 134 Amorsolo St., Legaspi Village, Makati City,
1229 Kalakhang Maynila
65 Parole and Probation Administration DOJ Agencies Bldg., NIA Road cor. East Ave., Diliman,
Quezon City
66 Presidential Commission on Good Government 82 RIC Bldg., de los Santos Ave., EDSA, Mandaluyong City
67 Public Attorney’s Office DOJ Agencies Bldg., NIA Road cor. East Ave., Diliman,
Quezon City
Department of Labor and Employment

68 Office of the Secretary DOLE Bldg., Muralla cor. Gen. Luna Sts., Intramuros,
Manila
69 Institute for Labor Studies 5/F DOLE Bldg., Intramuros, Manila
70 National Conciliation and Mediation Board 4/F-6/F Arcadia Bldg., Quezon Ave., Quezon City
71 National Labor Relations Commission PPSTA Bldg., Banaue Ave. cor. P. Florentino St., Quezon
City
72 National Maritime Polytechnic Brgy. Cabalawan, Tacloban City
73 National Wages and Productivity Commission 2/F & 3/F DY International Bldg., Gen. Malvar cor. San
Marcelino St., Malate, Manila
74 Overseas Workers Welfare Administration F.B. Harrison St, Pasay, Metro Manila
75 Philippine Overseas Employment Administration POEA Bldg., Ortigas Ave. cor. EDSA, Mandaluyong City
76 Professional Regulation Commission P. Paredes St. cor. N. Reyes St., Sampaloc, Manila
Department of National Defense

77 Office of the Secretary Camp General Emilio Aguinaldo, Quezon City
639
78 Armed Forces of the Philippines Commissary and Camp Emilio Aguinaldo, Quezon City
Exchange Service
79 AFP Health Service Command V. Luna Ave., Quezon City
80 General Headquarters, AFP and AFP Wide Service Camp General E. Aguinaldo, Quezon City
81 AFP Dental Service Center V. Luna Ave., Quezon City
82 Government Arsenal Camp Antonio Luna, Limay, Bataan
83 National Defense College of the Philippines “LOGCOM Compound, Camp Gen. Emilio Aguinaldo,
Quezon City
84 Office of Civil Defense 81 15th Ave., Murphy, Cubao, Quezon City, 1109 Metro
Manila
85 Philippine Veterans Affairs Office (Proper) Camp Emilio Aguinaldo, Quezon City
86 Philippine Army (Land Forces) Fort Bonifacio, Makati City
87 Philippine Air Force (Air Force) Villamor Airbase, Pasay City
88 Philippine Military Academy Fort del Pilar, Baguio City
89 Philippine Navy (Naval Force) Roxas Blvd., Manila
90 Presidential Security Group Malacañang Park, Manila
91 Veterans Memorial Medical Center North Avenue, Diliman, Quezon City
92 Veterans Golf Club Mindanao Ave., Proj. 6, Quezon City
Department of Public Works & Highways

93 Office of the Secretary Bonifacio Drive Port Area, 652 Zone 068, Manila, 1018
94 Road Board 2/F Ave Maria Bldg., 1517 Quezon Ave. cor. Exminer St.,
West Triangle, Quezon City
Department of Science and Technology

95 Office of the Secretary Gen. Santos Ave., Bicutan, Taguig, Metro Manila
96 Advanced Science and Technology Institute ASTI Bldg., Technopark Complex, CP Garcia St., UP
Diliman, Quezon City
97 Food and Nutrition Research Institute DOST Complex, Gen. Santos Ave., Bicutan, Taguig City
98 Forest Products Research and Development Institute Narra St., Forestry Campus, 4031 College, Laguna 4031
99 Industrial Technology Development Institute DOST Complex, Gen. Santos Ave. Bicutan, Taguig City
100 Metals Industry Research and Development Center Gen. Santos Ave., Bicutan, Taguig City
101 National Academy of Science and Technology 2/F Philippine Science Heritage Center (PSHC) Bldg., DOST
Complex, Gen. Santos Avenue, Bicutan, Taguig City
102 National Research Council of the Philippines Gen. Santos Avenue, Bicutan, Taguig City
103 Philippine Atmospheric, Geophysical and Astronomical PAGASA Science Garden, Agham Road, Quezon City
Services Administration
104 Philippine Council for Agriculture, Aquatic and Natural Paseo de Valmayor, Los Baños, Laguna
Resources Research and Development
105 Philippine Council for Health Research and Development 3/F DOST Main Bldg., Gen. Santos Ave., Bicutan, Taguig
City
106 Philippine Council for Industry, Energy and Emerging 4/F & 5/F Science Heritage Bldg., Gen. Santos Ave.,
Technology Research and Development Bicutan, Taguig City
107 Philippine Institute of Volcanology and Seismology Carlos P. Garcia Ave., UP Diliman, Quezon City
107 Philippine Nuclear Research Institute Commonwealth Avenue, Diliman, Quezon City
109 Philippine Science High School System Agham Road, Diliman, Quezon City
110 Philippine Textile Research Institute Gen. Santos Ave., Bicutan, Taguig City
111 Science Education Institute 1st and 2nd Level, Science Heritage Bldg., Gen. Santos
Avenue, Bicutan, Taguig City
112 Science and Technology Information Institute DOST Complex, Gen. Santos Ave., Bicutan, Taguig City
113 Technology Application and Promotion Institute DOST Complex, Gen. Santos Ave., Bicutan, Taguig City
Department of Social Welfare and Development

114 Office of the Secretary DSWD Building, Contitution Hills, Batasan Complex,
Quezon City
115 Council for the Welfare of Children 10 Apo St., Sta. Mesa Heights, Quezon City
116 Inter-Country Adoption Board 2 Chicago St. cor. Ermin Garcia St., Brgy. Pinagkaisahan,
Cubao, Quezon City
117 Juvenile Justice and Welfare Council 56 Matimtiman Street, Quezon City, 1101 Metro Manila
118 National Council on Disability Affairs NCDA Bldg., Isidora St., Barangay Holy Spirit, Quezon City
Department of Tourism
119 Office of the Secretary The New DOT Bldg., 351 Senator Gil Puyat Ave., Makati
City
120 Intramuros Administration Palacio del Governador Bldg., Intramuros, Manila
121 National Park Development Committee Agrifina Circle, Rizal Park, Kalaw Ave., Ermita, Manila
Department of Trade and Industry

122 Office of the Secretary 361 Sen. Gil J. Puyat Avenue, Makati City
123 Board of Investments Industry & Investments Building, 385 Sen. Gil J. Puyat
Avenue, 1200, Makati City
124 Construction Industry Authority of the Philippines 5/F Executive Bldg. Center 369 Sen. Gil J. Puyat Ave.,
Makati City
640
125 Intellectual Property Office 28 Upper McKinley Road, McKinley Hill Town Center Fort
Bonifacio, Taguig City
126 Philippine Trade Training Center International Trade Center Complex, Roxas Blvd. cor. Sen.
Gil J. Puyat Ave., Pasay City
127 Design Center of the Philippines DCP Bldg., CCP Complex, Roxas Blvd., Pasay City
Department of Transportation
128 Office of the Secretary Clark Freeport Zone, Mabalacat, Pampanga
129 Civil Aeronautics Board CAB Bldg., Old MIA Rd., Pasay City
130 Maritime Industry Authority #139 25th St., Port Area, Manila
131 Office for Transportation Security 2/F IBP Bldg., Dona Julia Vargas Ave., Ortigas Center, Pasig
City
132 Office of Transportation Cooperatives TRIDA Bldg., TM Kalaw Ave., Ermita, Manila
133 Philippine Coast Guard Sugar Center, North Avenue, Quezon City
134 Toll Regulatory Board Andrews Ave., cor. Aurora Blvd., Pasay City
Presidential Communications Operations Office

135 Presidential Communications Operations Office Proper 2/F New Executive Building (NEB), Malacañang Compound
136 Bureau of Broadcast Services 4/F Government Media Center Bldg., VARSA, Quezon City
137 Bureau of Communications Services 310 Philippine Cancer Society Bldg., San Rafael St.,
Malacañang Complex, San Miguel, Manila
138 National Printing Office EDSA cor. National Printing Office Road, Diliman, Quezon
City
139 News and Information Bureau Arlegui, Malacañang Compound, Manila
140 Philippine Information Agency PIA Bldg., Visayas Avenue, Diliman, Quezon City
141 Presidential Broadcast Staff (RTVM) RTVM Building, J. P. Laurel St., Malacañang, Manila 1005
National Economic and Development Authority

142 Office of the Director General 12 St., Josemaria Escriva Drive, Ortigas Center, Pasig City
1605
143 Philippine Statistics Authority 2/F TAM Bldg., PSA Complex, East Avenue, Diliman,
Quezon City, 1101
144 Philippine National Volunteer Service Coordinating Philippine Sugar Center Bldg., North Ave., Quezon City
Agency
145 Philippine Statistical Research and Training Institute J & S Bldg., 104 Kalayaan Ave, Diliman, Quezon City,
Metro Manila
146 Tariff Commission 4/F West Insula, West Ave., Quezon City
147 Public-Private Partnership Center of the Philippines 8/F, One Cyberpod Centris, EDSA cor. Quezon Ave., Brgy.
Piñahan, Quezon City 1001
Other Executive Offices

148 Anti-Money Laundering Council 5/F EDPC Bldg., Bangko Sentral ng Pilipinas Complex
Mabini corner Vito Cruz Streets Malate, Manila 1004
149 Climate Change Commission Rm. 238 Mabini Hall, Malacañang Compound, San Miguel,
Manila
150 Commission on Filipino Overseas City Gold Center, 1345 Pres. Quirino Avenue cor. South
Super Highway, Paco, Manila
151 Commission on Higher Education Higher Education Development Center (HEDC) Bldg., LP
Garcia, UP Campus, Quezon City 1101
152 Commission on the Filipino Language 2/F Watson Bldg., 1610 J. P. Laurel St., Malacañang Palace,
San Miguel, Manila
153 Cooperative Development Authority 5/F CDA Bldg., 827 Brgy. Immaculate Concepcion, Aurora
Blvd., Quezon City
154 Cultural Center of the Philippines CCP Complex, Roxas Boulevard, Magdalena Jalandoni,
Malate, Pasay
155 Dangerous Drug Board 3/F DDB-PDEA Bldg., National Government Center, NIA
Road, Brgy. Pinyahan, Quezon City
156 Energy Regulatory Commission 16/F Pacific Center, San Miguel Avenue, Ortigas Complex,
Pasig City
157 Fertilizer and Pesticide Authority FPA Bldg. BAI Compound, Visayas Avenue Diliman,
Quezon City
158 Film Development Council of the Philippines 26/F, 855 T.M. Kalaw St., Ermita, Manila
159 Games and Amusement Board 2/F Legaspi Towers, 200 Paseo de Roxas St., Legaspi
Village, Makati City
160 Governance Commission for Government-Owned or 3/F Citibank Centre, Citibank Plaza, Paseo de Roxas Cor.
Controlled Corporation Villar St., Makati City
161 Housing and Land Use Regulatory Board HLURB Bldg., Kalayaan Ave., Diliman, Quezon City
162 Housing and Urban Development Coordinating Council 9&15/F, BDO Plaza, 8737 Paseo de Roxas, Makati City
163 Mindanao Development Authority 4/F SSS Bldg., J. P. Laurel Ave., Davao City
164 Movie and Television Review and Classification Board #18 MTRCB Bldg., Timog Avenue, Quezon City
165 National Anti-Poverty Commission Water System Training Center, Local Water Utilities
Administration, MWSS-LWUA Complex, Katipunan
Avenue, Quezon City 1105
641
166 National Commission for Culture and the Arts – Proper 633 General Luna St., Intramuros, Manila
167 NCCA – National Historical Commission of the National Historical Commission of the Philippines (NHCP)
Philippines Bldg., T.M. Kalaw St., Manila, 1000
168 NCCA – National Library of the Philippines T. M. Kalaw St., Ermita, Manila
169 NCCA – National Archives of the Philippines VELCO Centre, R.S. Oca corner A.C. Delgado Streets, Port
Area, 1018 Manila
170 National Commission on Indigenous Peoples 2/F N. dela Merced Bldg. corner West & Quezon Ave.,
Quezon City
171 National Commission on Muslim Filipinos 79 Jocfer Annex Bldg., Commonwealth Ave., Diliman,
Quezon City
172 National Intelligence Coordinating Agency V. Luna Road cor. East Ave., Quezon City
173 National Security Council NICA Compound, V. Luna Road cor. East Ave., Diliman,
Quezon City
174 National Youth Commission 4/F Bookman Bldg., 373 Quezon Ave, Quezon City
175 Office of the Presidential Adviser on the Peace Process 7/F, Agustin Building, F. Ortigas Jr. Road, Ortigas Center,
Pasig
176 Optical Media Board 35 Scout Limbaga, Brgy. Laging Handa, Quezon City
177 Pasig River Rehabilitation Commission 5/F, Triumph Building, 1610 Quezon Avenue 1103, Quezon
Ave., Diliman, Quezon City, 1104 Metro Manila
178 Philippine Coconut Authority Q.C. Elliptical Road, Diliman, Quezon City 1101 Metro
Manila
179 Philippine Competition Commission 2/F, Development Academy of the Philippines (DAP) Bldg.,
San Miguel Ave., Ortigas Center, Pasig City
180 Philippine Drug Enforcement Agency PDEA Bldg., NIA Road, National Government Center, Brgy.
Pinyahan, Quezon City
181 Philippine Racing Commission 4/F Electra House, Herrera-Esteban Sts., Legaspi Village,
Makati City
182 Philippine Sports Commission Rizal Memorial Sports Complex, Pablo Ocampo Sr. St.,
Malate, Manila
183 Philippines Commission on Women 1145 J. P. Laurel St., San Miguel, Manila
184 Presidential Commission for the Urban Poor 4th floor, DHC Bldg. 1115 EDSA, Project 7, Quezon City
185 Presidential Communications Development and Strategic 3/F New Executive Building, Jose P. Laurel St., Malacañang,
Planning Office Manila
186 Presidential Legislative Liaison Office 2/F Annex New Executive Bldg., Malacañang, Manila
187 Presidential Management Staff AAP Tower #683 Aurora Blvd., Quezon City
188 Technical Education and Skills Development Authority TESDA Administrative Bldg., TESDA Complex, East
Service Road, South Superhighway, Taguig, Metro
Manila
Constitutional Offices
Civil Service Commission
189 Civil Service Commission Constitutional Hills, Batasang Pambansa Complex, Diliman
Quezon City 1126
190 Career Executive Service Board Number 3, Marcelino Street, Holy Spirit Drive, Isidora Hills,
Diliman, Quezon City, 1127
191 Commission on Audit Commonwealth Avenue, Quezon City 1100
192 Commission on Human Rights SAAC Bldg., UP Complex, Commonwealth Ave., Diliman,
Quezon City
193 Office of the Ombudsman Ombudsman Bldg., Agham Road, North Triangle, Diliman,
Quezon City 1101
Congress of the Philippines

194 Senate of the Philippines GSIS Complex, Pasay City
195 Senate Electoral Tribunal Commison On Audit National Capital Region Building, IBP
Road, Batasan Hills, Quezon City, 1126 Metro Manila
196 Commission on Appointments 6F PNB Financial Center, D. Macapagal Blvd., Pasay City
197 House of Representatives National Government Center, Quezon City
198 House of Representatives Electoral Tribunal Commision On Audit National Capital Region Building, IBP
Road Batasan Hills, Quezon City, 1126 Metro Manila
The Judiciary
199 Supreme Court of the Philippines and the Lower Courts Padre Faura Street cor. Taft Ave., Ermita, Manila
200 Presidential Electoral Tribunal Commonwealth Avenue, corner Batasan Road, Quezon City
201 Sandiganbayan Centennial Building Commonwealth Avenue, corner Batasan
Road, Quezon City
202 Court of Appeals Maria Orosa St., Ermita, Manila
203 Court of Tax Appeals Agham Road, Government Center, Diliman, Quezon City
Joint Legislative Executive Council

204 Legislative Executive Advisory Council Ground Floor, NEDA Sa Pasig Building, Escriva Drive,
Pasig City
642
Metro Manila Development Authority

205 Metro Manila Development Authority MMDA Building, EDSA corner Orense St., Guadalupe
Nuevo, Makati City
Autonomous Region in Muslim Mindanao

206 Office of the Regional Governor Proper ARMM Compound, Gov. Gutierrez St. Cotabato City, 9600
207 Regional Legislative Assembly ARMM Complex, Gov. Gutierrez Street, Cotabato City
State Universities and Colleges

208 Eulogio "Amang " Rodriguez Institute of Science & Nagtahan St., Sampaloc, Manila
Technology
209 Marikina Polytechnic College Mayor Juan Chanyungco St., Sta. Elena, Marikina City
210 Philippine Normal University Taft Avenue, Manila
211 Philippine State College of Aeronautics Villamor Air Base, Pasay City
212 Polytechnic University of the Philippines Sta. Mesa, Manila
213 Rizal Technological University Boni Avenue, Mandaluyong City
214 Technological University of the Philippines Ayala Boulevard, Ermita, Manila
215 University of the Philippines System Diliman, Quezon City, 1101
216 Don Mariano Marcos Memorial State University La Union
217 Ilocos Sur Polytechnic State College Municipality of Sta. Maria, Ilocos Sur
218 North Luzon Philippine State College San Nicolas, Candon City, Ilocos Sur
219 Mariano Marcos State University City of Batac, Ilocos Norte
220 Pangasinan State University Municipality of Lingayen, Pangasinan
221 University of Northern Philippines Vigan City, Ilocos Sur
222 Abra State Institute of Science and Technology Lagangilang, Abra
223 Apayao State College Malama, Conner, Apayao
224 Benguet State University La Trinidad, Benguet
225 Ifugao State University Lamut, Ifugao
226 Kalinga State University Tabuk, Kalinga
227 Mountain Province State Polytechnic College Poblacion, Bontoc, Mountain Province
228 Batanes State College Basco, Batanes
229 Cagayan State University Tuguegarao City, Cagayan
230 Isabela State University Echague, Isabela
231 Nueva Vizcaya State University Echague, Isabela; Bayombong, Nueva Vizcaya
232 Quirino State College Diffun, Quirino
233 Aurora State College of Technology Sitio Dicaloyungan, Brgy. Zabali, Baler, Aurora
234 Bataan Peninsula State University Balanga City, Bataan
235 Bulacan Agricultural State College San Ildefonso, Bulacan
236 Bulacan State University Manila North Road, Brgy. Guinhawa, Malolos City, Bulacan
237 Central Luzon State University Science City of Muñoz, Nueva Ecija
238 Don Honorio Ventura Technological State University Bacolor, Pampanga
239 Nueva Ecija University of Science and Technology Gen. Tinio Street, Cabanatuan City
240 Pampanga State Agricultural University Magalang, Pampanga
241 Philippine Merchant Marine Academy Brgy. San Nicolas, San Narciso, Zambales
242 Ramon Magsaysay Technological University Iba, Zambales
243 Tarlac College of Agriculture Camiling, Tarlac
244 Tarlac State University Tarlac City
245 Batangas State University Rizal Avenue Extension, Batangas
246 Cavite State University Indang, Cavite
247 Laguna State Polytechnic University Sta. Cruz, Laguna
248 Southern Luzon State University Lucban, Quezon
249 University of Rizal System Morong, Rizal
250 Marinduque State College Tanza, Boac, Marinduque
251 Mindoro State University Victoria, Oriental Mindoro
252 Occidental Mindoro State College San Jose, Occidental Mindoro
253 Palawan State University Puerto Princesa City, Palawan
254 Romblon State University Odiongan, Romblon
255 Western Philippines University Aborlon, Palawan
256 Bicol State College of Applied Sciences and Technology Penafrancia Ave, Naga, Camarines Sur
257 Bicol University Legazpi City
258 Camarines Norte State College Daet, Camarines Norte
259 Camarines Sur Polytechnic Colleges Nabua, Camarines Sur
260 Catanduanes State University Virac, Catanduanes
261 Central Bicol State University of Agriculture Pili, Camarines Sur
262 Dr. Emilio B. Espinosa Sr. Memorial State College of Mandaon, Masbate
Agriculture and Technology
263 Partido State University Goa, Camarines Sur
264 Sorsogon State College Sorsogon City
265 Aklan State University Banga, Aklan
266 Capiz State University Roxas City, Capiz
267 Carlos C. Hilado Memorial State College Talisay City, Negros Occidental
268 Guimaras State College Buenvista, Guimaras
643
269 Iloilo State University of Science and Technology Barotac Nuevo, Iloilo
270 Central Philippines State University Kabankalan City, Negros Occidental
271 Northern Iloilo State University Estancia, Iloilo
272 Northern Negros State College of Science and Sagay City, Negros Occidental
Technology
273 University of Antique Santiago Lotilla Street, Sibalom, Antique
274 Iloilo Science and Technology University Burgos St., La Paz, Iloilo City
275 West Visayas State University Luna St., La Paz, Iloilo City
276 Bohol Island State University Carlos P. Garcia North Ave., Tagbiliran City
277 Cebu Normal University Osmeña Boulevard, Cebu City
278 Cebu Technological University Cor. M.J. Cuenco Ave. and R. Palma St., Cebu City
279 Negros Oriental State University Kagawasan Avenue, Dumaguete City
280 Siquijor State College Larena, Siquijor
281 Eastern Samar State University Borongan, Eastern Samar
282 Eastern Visayas State University Aquino Avenue, Tacloban City, Leyte
283 Leyte Normal University Tacloban City, Leyte
284 Naval State University Naval, Biliran
285 Northwest Samar State University Calbayog City, Samar
286 Palompon Polytechnic State University Evangelista St., Palompon, Leyte
287 Samar State University Catbalogan, Samar
288 Southern Leyte State University Sogod, Southern Leyte
289 University of Eastern Philippines University Town, Catarman, Northern Samar
290 Visayas State University Visca, Baybay City, Leyte
291 J. H. Cerilles State College San Miguel, Zamboanga del Sur
292 Jose Rizal Memorial State University Dapitan City, Zamboanga del Norte
293 Western Mindanao State University Normal Road, San Jose, Zamboanga City
294 Zamboanga City State Polytechnic College Zamboanga City
295 Zamboanga State College of Marine Science and Fort Pilar, Zamboanga City
Technology
296 Bukidnon State University Fortich Street, Malaybalay City, Bukidnon
297 Camiguin Polytechnic State College Balbagon, Mambajao, Camiguin
298 Central Mindanao University Musuan, Bukidnon
299 University of Science and Technology of Southern Claro M. Recto Avenue, Lapasan, Cagayan de Oro City
Philippines – Cagayan de Oro
300 MSU - Iligan Institute of Technology Andres Bonifacio Avenue, Tibanga, 9200 Iligan City
301 University of Science and Technology of Southern Claveria, Misamis Oriental
Philippines – Claveria
302 Northwestern Mindanao State College Science and Labuyo, Tangub City
Technology
303 Compostela Valley State College 8801, Montevista, Compostela Valley
304 Davao del Norte State College New Visayas, Panabo City, Davao del Norte
305 Davao Oriental State College of Science and Technology Mati, Davao Oriental
306 Southern Philippines Agri-Business and Marine Aquatic Malita, Davao del Sur
School of Technology
307 University of Southeastern Philippines Iñigo St., Obrero, Davao City
308 Cotabato State University Sinsuat Avenue, Maguindanao, Cotabato City
309 Cotabato Foundation College of Science and Technology Doroluman, Arakan, Cotabato
310 Sultan Kudarat State University Tacurong City, Sultan Kudarat
311 University of Southern Mindanao Kabacan, North Cotabato
312 Agusan del Sur State College of Agriculture and Bunawan, Agusan del Sur
Technology
313 Caraga State University Ampayon, Butuan City, Agusan del Norte
314 Surigao del Sur State University Tandag, Surigao del Sur
315 Surigao State College of Technology Surigao City
316 Adiong Memorial Polytechnic State College Dit-saan Ramain, Lanao del Sur
317 Basilan State College Isabela City, Basilan
318 Mindanao State University System Marawi City
319 MSU - Tawi-Tawi College of Technology and Sanga-Sanga, Bongao, Tawi-Tawi
Oceanography
320 Sulu State College Jolo, Sulu
321 Tawi-Tawi Regional Agricultural College Bongao, Tawi-Tawi
644
ANNEX B
ORIGINAL BUDGETED RECEIPTS
Service and
Shares, Grants
SEQ.
Tax Revenue Business Gains Others TOTAL

DEPARTMENT and Donations
Income
(in thousand pesos)
1 Congress of the Philippines - 45 - - - 45
2 Office of the President - 6,112 - - - 6,112
3 Office of the Vice-President - - - - - -
4 Agrarian Reform - 20,021 - 17 - 20,038
5 Agriculture - 621,970 - 2,197 2,681 626,848
6 Budget And Management - - - - - -
7 Education - 81,381 500,000 - 71 581,452
8 State Universities and Colleges - - - - - -
9 Energy - 14,444,371 - - - 14,444,371
645
10 Environment And Natural

Resources 139,000 1,274,997 464,882 2,969 - 1,881,848
11 Finance 2,297,531,975 84,909,474 17,483,000 - 724,033 2,400,648,482
12 Foreign Affairs - 6,518,612 - - 2,051 6,520,663
13 Health - 926,655 - - - 926,655
14 Information and Communications
Technology - 4,351,174 - - - 4,351,174
15 Interior and Local Government 1,484,000 1,572,958 - - - 3,056,958
16 Justice 78,000 10,703,218 - 184 7,827 10,789,229
17 Labor and Employment - 2,411,184 - - 25,496 2,436,680
18 National Defense - 243,765 - 17,273 649,097 910,135
19 Public Works and Highways - 613,882 - - 6,387 620,269
20 Science and Technology - 132,795 71,167 - 429 204,391
21 Social Welfare and Development - 80,212 - - - 80,212
22 Tourism - 69,969 - - 50 70,019
23 Trade and Industry - 418,246 - - 272 418,518
24 Transportation 12,250,000 11,631,824 - - - 23,881,824
25 National Economic and
Development Authority - 983,422 - 3 1,017 984,442
Service and
Shares, Grants
SEQ.
Income
(in thousand pesos)
26 Presidential Communications
Operations Office - 6,000 - - 444 6,444
27 Other Executive Offices 1,988,000 2,075,569 928,184 4 48,454 5,040,211
28 Autonomous Region in Muslim
Mindanao - - - - - -
29 Joint Legislative-Executive
Councils - - - - - -
30 The Judiciary - 81,820 - - - 81,820
31 Civil Service Commission - - - - - -
32 Commission on Audit - 836,071 - - - 836,071
33 Office of the Ombudsman - 6,181 - - - 6,181
34 Commission on Human Rights - - - - - -
35 Metropolitan Manila Development
Authority - - - - - -
646
GRAND TOTAL 2,313,470,975 145,021,928 19,447,233 22,647 1,468,309 2,479,431,092

ANNEX C
FINAL BUDGETED RECEIPTS
Service and
Shares, Grants
SEQ.

Income
(in thousand pesos)
1 Congress of the Philippines - 6,121 - - 539 6,659
3 Office of the Vice-President - - - - 113 113
4 Agrarian Reform - 38,281 - 42 66 38,388
5 Agriculture - 639,302 - 3,152 11,835 654,289
6 Budget And Management - 3,318 - - 222 3,541
7 Education - 247,740 256,534 - 23,635 527,909
9 Energy - 28,788 23,942,291 - - 23,971,079
647

Resources 17,084 785,642 1,008,933 5,241 4,642 1,821,542
11 Finance 2,302,875,277 77,931,175 31,695,283 2,476,193 1,502,753,665 3,917,731,593
12 Foreign Affairs - 6,940,490 - - 16,623 6,957,113
13 Health - 3,315,846 - - - 3,315,846
Technology - 3,987,951 - - - 3,987,951
15 Interior and Local Government 1,484,000 1,536,065 - - - 3,020,065
16 Justice 88,194 11,038,074 - 184 6,170 11,132,622
19 Public Works and Highways - 3,757,472 - - - 3,757,472
20 Science and Technology - 163,564 - 69 2 163,635
21 Social Welfare and Development - 84,803 - - - 84,803
22 Tourism - 63,876 - - - 63,876
23 Trade and Industry - 417,947 - - - 417,947
24 Transportation 14,876,419 8,217,108 - - - 23,093,527
Development Authority - 1,020,613 178 248 1,690 1,022,729
Service and
Shares, Grants
SEQ.
Income
(in thousand pesos)
27 Other Executive Offices 2,044,300 2,136,708 943,275 4 57,532 5,181,819
30 The Judiciary - 82,183 - - - 82,183
648
GRAND TOTAL 2,321,385,275 126,116,293 57,846,494 2,502,405 1,503,541,584 4,011,392,052

ANNEX D
ACTUAL RECEIPTS
Service and
Shares, Grants
SEQ.

Income
(in thousand pesos)
1 Congress of the Philippines - 6,121 - - 539 6,659
3 Office of the Vice-President - - - - 113 113
4 Agrarian Reform - 19,026 - 6 87 19,120
5 Agriculture - 687,372 - 451 19,133 706,957
6 Budget And Management - 3,318 - - 222 3,541
7 Education - 311,622 256,534 - 24,738 592,893
9 Energy - 46,897 21,607,204 - - 21,654,101
649

Resources - 1,810,792 1,127,567 3,898 9,400 2,951,657
11 Finance 2,247,976,215 79,523,413 31,695,283 2,476,193 1,502,312,162 3,863,983,267
12 Foreign Affairs - 7,698,977 - - 27 7,699,004
13 Health - 2,403,397 12,658 11,799 108,576 2,536,430
Technology - 4,808,549 - - - 4,808,549
15 Interior and Local Government - 1,691,453 - - 3,264 1,694,717
16 Justice 115,702 14,783,255 - - 7,722 14,906,678
18 National Defense - 3,740 - 234 1,363 5,336
19 Public Works and Highways - 365,906 - - 12,099 378,005
20 Science and Technology - 215,339 - 42 40 215,421
21 Social Welfare and Development - 67,476 7,017 2,409 3,840 80,742
22 Tourism - 75,981 - - 1,402 77,383
23 Trade and Industry - 803,643 - 228 - 803,871
24 Transportation 15,992,883 10,332,924 - 16,271 540 26,342,619
Development Authority - 1,385,410 178 353 1,364 1,387,304
Service and
Shares, Grants
SEQ.
Income
(in thousand pesos)
27 Other Executive Offices 493,247 2,307,939 131,812 - 17,468 2,950,466
30 The Judiciary - 73,173 - - - 73,173
650
GRAND TOTAL 2,264,578,047 133,136,549 54,838,252 2,511,883 1,502,526,800 3,957,591,532

ANNEX E
DIFFERENCE BETWEEN THE FINAL BUDGETED RECEIPTS AND ACTUAL RECEIPTS
Service and
Shares, Grants
SEQ.

Income
(in thousand pesos)
1 Congress of the Philippines - - - - - -
3 Office of the Vice-President - - - - - -
4 Agrarian Reform - 19,254 - 36 (22) 19,268
5 Agriculture - (48,070) - 2,700 (7,298) (52,668)
6 Budget And Management - - - - - -
7 Education - (63,882) - - (1,103) (64,985)
9 Energy - (18,109) 2,335,087 - - 2,316,978
651

Resources 17,084 (1,025,150) (118,634) 1,343 (4,758) (1,130,115)
11 Finance 54,899,062 (1,592,238) - - 441,502 53,748,326
12 Foreign Affairs - (758,487) - - 16,596 (741,891)
13 Health - 912,449 (12,658) (11,799) (108,576) 779,416
Technology - (820,598) - - - (820,598)
15 Interior and Local Government 1,484,000 (155,388) - - (3,264) 1,325,348
16 Justice (27,508) (3,745,181) - 184 (1,551) (3,774,056)
17 Labor and Employment - (758,242) - - 13,053 (745,190)
19 Public Works and Highways - 3,391,566 - - (12,099) 3,379,467
20 Science and Technology - (51,775) - 27 (38) (51,786)
21 Social Welfare and Development - 17,327 (7,017) (2,409) (3,840) 4,061
22 Tourism - (12,105) - - (1,402) (13,507)
23 Trade and Industry - (385,696) - (228) - (385,924)
24 Transportation (1,116,464) (2,115,816) - (16,271) (540) (3,249,091)
Development Authority - (364,797) - (104) 326 (364,575)
Service and
Shares, Grants
SEQ.
Income
(in thousand pesos)
Operations Office - 2,857 - - - 2,857
27 Other Executive Offices 1,551,053 (171,231) 811,463 4 40,064 2,231,353
30 The Judiciary - 9,010 - - - 9,010
33 Office of the Ombudsman - (12,582) - - - (12,582)
652
GRAND TOTAL 56,807,228 (7,020,256) 3,008,242 (9,478) 1,014,784 53,800,519

ANNEX F
ORIGINAL BUDGETED PAYMENTS

Maintenance
Debt Service
Personnel and Other Financial
SEQ.
Capital Outlays (Principal TOTAL

DEPARTMENT Services Operating Expenses
Amortization)
Expenses
(in thousand pesos)
1 Congress of the Philippines 7,829,018 8,539,625 642,145 - - 17,010,788
2 Office of the President 754,144 19,433,305 212,955 - - 20,400,403
3 Office of the Vice-President 67,611 357,324 10,159 - - 435,094
4 Agrarian Reform 4,274,436 4,725,685 1,803,743 - - 10,803,864
5 Agriculture 4,567,683 30,153,819 28,606,047 1,934 - 63,329,482
6 Budget And Management 1,568,922 1,060,376 133,253 108 - 2,762,659
7 Education 355,598,937 94,847,066 151,291,974 - - 601,737,976
8 State Universities and Colleges 38,903,368 13,024,494 12,277,714 - - 64,205,576
9 Energy 468,086 2,929,627 397,702 - - 3,795,415
653
10 Environment And Natural Resources 7,779,792 12,429,642 10,906,591 - - 31,116,025

11 Finance 7,776,578 545,965,084 10,172,936 335,805,349 313,259,830 1,212,979,777
12 Foreign Affairs 7,299,682 10,464,832 2,074,353 25,299 - 19,864,165
13 Health 31,634,271 48,455,653 40,940,061 - - 121,029,986
Technology 801,611 2,548,938 1,239,458 4,590,007
15 Interior and Local Government 118,128,116 24,304,635 10,274,758 152,707,508
16 Justice 11,747,847 4,506,821 901,886 - - 17,156,554
17 Labor and Employment 3,946,308 7,466,254 639,479 3,000 - 12,055,041
18 National Defense 72,553,045 39,123,551 36,838,546 19 - 148,515,161
19 Public Works and Highways 8,446,531 18,885,904 676,048,250 - - 703,380,685
20 Science and Technology 3,208,755 12,075,529 6,947,564 - - 22,231,848
21 Social Welfare and Development 6,275,363 136,147,291 1,028,187 1,511,000 - 144,961,842
22 Tourism 528,836 2,841,246 468,001 1,601 - 3,839,685
23 Trade and Industry 1,832,998 3,796,269 319,805 2,311 - 5,951,382
24 Transportation 7,124,726 17,780,013 54,384,640 6,182 - 79,295,562
25 National Economic and Development
Authority 1,895,445 3,179,912 571,236 211 - 5,646,804
Maintenance
Debt Service
SEQ.
Amortization)
Expenses
(in thousand pesos)
Operations Office 794,946 578,791 23,546 - - 1,397,284
27 Other Executive Offices 7,215,584 36,179,694 7,602,492 10 - 50,997,780
Mindanao 14,910,389 4,017,286 14,161,403 - - 33,089,079
29 Joint Legislative-Executive Councils 2,938 550 - - - 3,488
30 The Judiciary 23,715,294 5,631,696 3,425,789 - - 32,772,779
31 Civil Service Commission 1,075,081 292,996 59,972 9 - 1,428,058
32 Commission on Audit 10,332,328 368,441 311,420 - - 11,012,189
33 Office of the Ombudsman 1,889,578 452,339 104,754 - - 2,446,671
34 Commission on Human Rights 323,405 321,960 105,484 10 - 750,859
Authority 3,766 - - - - 3,766
654
GRAND TOTAL 765,275,418 1,112,886,647 1,074,926,306 337,357,043 313,259,830 3,603,705,244

ANNEX G
FINAL BUDGETED PAYMENTS
Maintenance
Debt Service
SEQ.

Amortization)
Expenses
(in thousand pesos)
1 Congress of the Philippines 6,511,999 10,951,564 806,424 30 - 18,270,018
4 Agrarian Reform 4,663,964 7,118,986 2,075,265 - - 13,858,214
5 Agriculture 4,919,341 28,598,475 18,272,415 3,119 - 51,793,350
6 Budget And Management 2,265,256 963,609 231,906 203 - 3,460,974
7 Education 358,635,475 99,961,893 42,643,576 - - 501,240,944
655

9 Energy 523,471 2,091,494 366,615 - - 2,981,581
11 Finance 8,431,788 738,302,725 16,778,756 335,935,601 312,403,000 1,411,851,869
12 Foreign Affairs 7,389,021 9,676,118 3,529,630 29,165 - 20,623,936
13 Health 33,393,718 44,170,415 36,711,131 - - 114,275,264
Technology 886,308 4,482,968 1,176,910 6,546,186
16 Justice 14,437,261 5,047,602 1,365,080 - - 20,849,943
18 National Defense 127,955,742 41,717,751 54,222,713 38 223,896,245
21 Social Welfare and Development 6,103,865 153,808,070 677,262 979,173 - 161,568,370
22 Tourism 581,925 3,076,944 356,919 1,622 - 4,017,410
24 Transportation 8,494,516 21,054,331 53,922,806 7,443 - 83,479,096
Maintenance
Debt Service
SEQ.
Amortization)
Expenses
(in thousand pesos)
Authority 2,118,005 3,948,747 637,062 425 - 6,704,240
Operations Office 829,302 2,089,246 77,672 - - 2,996,220
Mindanao 14,505,396 7,179,325 16,082,472 - - 37,767,193
30 The Judiciary 25,784,183 5,075,947 3,915,383 - - 34,775,513
32 Commission on Audit 10,435,215 646,339 587,797 2 - 11,669,353
656
Authority 45,905 1,539,642 1,046,380 - - 2,631,927

GRAND TOTAL 882,630,668 1,350,721,161 969,448,256 336,961,159 312,403,000 3,852,164,245
ANNEX H
ACTUAL PAYMENTS
Maintenance
Debt Service
SEQ.

Amortization)
Expenses
(in thousand pesos)
1 Congress of the Philippines 5,793,070 6,918,142 358,052 30 - 13,069,295
4 Agrarian Reform 4,490,428 2,981,933 801,326 - - 8,273,687
5 Agriculture 4,690,725 18,263,076 9,519,821 853 - 32,474,475
6 Budget And Management 2,232,850 478,792 48,501 29 - 2,760,172
7 Education 320,622,198 57,136,423 6,676,993 - - 384,435,613
9
657
Energy 479,278 515,438 3,763 - - 998,479

11 Finance 7,401,621 632,079,378 10,444,764 311,043,334 152,996,820 1,113,965,917
12 Foreign Affairs 7,199,055 7,955,304 2,015,715 20,498 - 17,190,572
13 Health 29,605,433 31,364,903 6,053,278 - - 67,023,613
Technology 837,353 1,506,935 61,884 2,406,172
16 Justice 13,763,361 3,413,299 209,423 - - 17,386,083
18 National Defense 123,167,854 28,090,620 21,008,617 - - 172,267,090
21 Social Welfare and Development 5,865,612 123,179,396 180,782 579,547 - 129,805,337
22 Tourism 499,741 1,861,136 46,604 1,261 - 2,408,743
24 Transportation 7,893,659 11,508,175 7,714,097 6,328 - 27,122,260
Authority 2,034,346 2,302,533 195,283 3 - 4,532,165
Maintenance
Debt Service
SEQ.
Amortization)
Expenses
(in thousand pesos)
Operations Office 653,456 1,891,199 57,710 - - 2,602,366
Mindanao 12,131,747 6,084,517 4,924,552 - - 23,140,816
30 The Judiciary 24,289,020 4,481,228 3,318,020 - - 32,088,269
32 Commission on Audit 10,166,874 595,591 215,663 1 - 10,978,129
Authority 43,622 1,178,515 55,850 - - 1,277,988
658
GRAND TOTAL 811,113,046 1,042,083,209 301,198,843 311,655,887 152,996,820 2,619,047,806

ANNEX I
DIFFERENCE BETWEEN THE FINAL BUDGETED PAYMENTS AND ACTUAL PAYMENTS
Maintenance
Debt Service
SEQ.

Amortization)
Expenses
(in thousand pesos)
1 Congress of the Philippines 718,929 4,033,422 448,372 - - 5,200,723
4 Agrarian Reform 173,536 4,137,053 1,273,939 - - 5,584,528
5 Agriculture 228,615 10,335,399 8,752,594 2,267 - 19,318,875
6 Budget And Management 32,406 484,817 183,405 174 - 700,802
7 Education 38,013,278 42,825,470 35,966,583 - - 116,805,331
9
659
Energy 44,194 1,576,056 362,852 - - 1,983,102

10 Environment And Natural Resources 293,064 4,468,087 4,326,625 - - 9,087,776
11 Finance 1,030,166 106,223,347 6,333,992 24,892,267 159,406,180 297,885,952
12 Foreign Affairs 189,966 1,720,815 1,513,915 8,667 - 3,433,364
13 Health 3,788,285 12,805,512 30,657,853 - - 47,251,651
Technology 48,955 2,976,033 1,115,025 - - 4,140,014
15 Interior and Local Government 9,484,718 4,624,305 11,447,820 - - 25,556,842
16 Justice 673,900 1,634,303 1,155,657 - - 3,463,860
17 Labor and Employment 741,890 3,540,564 489,212 227 - 4,771,893
18 National Defense 4,787,889 13,627,131 33,214,096 38 - 51,629,154
19 Public Works and Highways 993,767 11,679,728 450,058,370 - - 462,731,864
20 Science and Technology 325,639 2,309,258 5,074,933 - - 7,709,830
21 Social Welfare and Development 238,253 30,628,673 496,480 399,626 - 31,763,033
22 Tourism 82,183 1,215,808 310,316 361 - 1,608,667
23 Trade and Industry 117,890 703,735 217,378 99 - 1,039,101
24 Transportation 600,857 9,546,155 46,208,708 1,115 - 56,356,836
Authority 83,660 1,646,214 441,780 422 - 2,172,075
Maintenance
Debt Service
SEQ.
Amortization)
Expenses
(in thousand pesos)
Operations Office 175,846 198,047 19,962 - - 393,855
27 Other Executive Offices 400,029 22,320,734 6,168,857 8 - 28,889,628
Mindanao 2,373,649 1,094,808 11,157,920 - - 14,626,377
29 Joint Legislative-Executive Councils 20 108 - - - 128
30 The Judiciary 1,495,163 594,719 597,363 - - 2,687,245
31 Civil Service Commission 7,420 7,247 770 - - 15,436
32 Commission on Audit 268,341 50,748 372,134 1 - 691,224
33 Office of the Ombudsman 42,234 102,382 108,167 - - 252,783
Authority 2,283 361,127 990,530 - - 1,353,940
660
GRAND TOTAL 71,517,622 308,637,952 668,249,413 25,305,272 159,406,180 1,233,116,439

ANNEX J
NET RECEIPTS/PAYMENTS
Congress of Office of the State

Office of the Agrarian Budget And
DEPARTMENT Total the Vice- Agriculture Education Universities Energy
President Reform Management
Philippines President and Colleges
RECEIPTS
Original 2,479,431,092 45 6,112 - 20,038 626,848 - 581,452 - 14,444,371
Final 4,011,392,052 6,659 6,112 113 38,388 654,289 3,541 527,909 - 23,971,079
Actual Amounts on
Comparable Basis 3,957,591,532 6,659 4,594 113 19,120 706,957 3,541 592,893 - 21,654,101
Difference Final Budget and
Actual 53,800,519 - 1,518 - 19,268 (52,668) - (64,985) - 2,316,978
PAYMENTS
661
Original 3,603,705,244 17,010,788 20,400,403 435,094 10,803,864 63,329,482 2,762,659 601,737,976 64,205,576 3,795,415
Final 3,852,164,245 18,270,018 16,747,156 696,230 13,858,214 51,793,350 3,460,974 501,240,944 69,176,550 2,981,581
Actual Amounts on
Comparable Basis 2,619,047,806 13,069,295 8,572,342 615,230 8,273,687 32,474,475 2,760,172 384,435,613 53,542,969 998,479
Actual 1,233,116,439 5,200,723 8,174,814 1,000 5,584,528 19,318,875 700,802 116,805,331 15,633,582 1,983,102
NET RECEIPTS/
(PAYMENTS)
Original (1,124,274,152) (17,010,743) (20,394,291) (435,094) (10,783,826) (62,702,634) (2,762,659) (601,156,524) (64,205,576) 10,648,956
Final 159,227,807 (18,263,358) (16,741,044) (696,117) (13,819,826) (51,139,061) (3,457,433) (500,713,036) (69,176,550) 20,989,498
Actual Amounts on
Comparable Basis 1,338,543,726 (13,062,635) (8,567,748) (615,117) (8,254,567) (31,767,518) (2,756,631) (383,842,720) (53,542,969) 20,655,622
Difference Final Budget
and Actual (1,179,315,920) (5,200,723) (8,173,296) (81,000) (5,565,259) (19,371,542) (700,802) (116,870,316) (15,633,582) 333,876
Environment Information and Interior and Public Works
Foreign Labor and National
DEPARTMENT And Natural Finance Health Communications Local Justice and
Affairs Employment Defense
Resources Technology Government Highways
RECEIPTS
Original 1,881,848 2,400,648,482 6,520,663 926,655 4,351,174 3,056,958 10,789,229 2,436,680 910,135 620,269
Final 1,821,542 3,917,731,593 6,957,113 3,315,846 3,987,951 3,020,065 11,132,622 2,560,161 909,985 3,757,472
Actual Amounts on
Comparable Basis 2,951,657 3,863,983,267 7,699,004 2,536,430 4,808,549 1,694,717 14,906,678 3,305,351 5,336 378,005
Actual (1,130,115) 53,748,326 (741,891) 779,416 (820,598) 1,325,348 (3,774,056) (745,190) 904,649 3,379,467
662
PAYMENTS
Original 31,116,025 1,212,979,777 19,864,165 121,029,986 4,590,007 152,707,508 17,156,554 12,055,041 148,515,161 703,380,685
Final 31,299,286 1,411,851,869 20,623,936 114,275,264 6,546,186 209,485,201 20,849,943 15,176,086 223,896,245 688,995,027
Actual Amounts on
Comparable Basis 22,211,510 1,113,965,917 17,190,572 67,023,613 2,406,172 183,928,359 17,386,083 10,404,193 172,267,090 226,263,163
Actual 9,087,776 297,885,952 3,433,364 47,251,651 4,140,014 25,556,842 3,463,860 4,771,893 51,629,154 462,731,864
NET RECEIPTS/
(PAYMENTS)
Original (29,234,177) 1,187,668,705 (13,343,502) (120,103,331) (238,833) (149,650,550) (6,367,325) (9,618,361) (147,605,026) (702,760,416)
Final (29,477,744) 2,505,879,724 (13,666,823) (110,959,418) (2,558,235) (206,465,136) (9,717,321) (12,615,924) (222,986,259) (685,237,555)
Actual Amounts on
Comparable Basis (19,259,853) 2,750,017,350 (9,491,568) (64,487,183) 2,402,376 (182,233,642) (2,479,405) (7,098,842) (172,261,754) (225,885,157)
Difference Final Budget
and Actual (10,217,891) (244,137,626) (4,175,255) (46,472,235) (4,960,612) (24,231,494) (7,237,916) (5,517,082) (50,724,505) (459,352,398)
National
Autonomous Joint
Social Economic Presidential Other
Science and Trade and Region in Legislative-
DEPARTMENT Welfare and Tourism Transportation and Communications Executive
Technology Industry Muslim Executive
Development Development Operations Office Offices
Mindanao Councils
Authority
RECEIPTS
Original 204,391 80,212 70,019 418,518 23,881,824 984,442 6,444 5,040,211 - -
Final 163,635 84,803 63,876 417,947 23,093,527 1,022,729 6,195 5,181,819 - -
Actual Amounts on
Comparable Basis 215,421 80,742 77,383 803,871 26,342,619 1,387,304 3,338 2,950,466 - -
Actual (51,786) 4,061 (13,507) (385,924) (3,249,091) (364,575) 2,857 2,231,353 - -
PAYMENTS
Original 22,231,848 144,961,842 3,839,685 5,951,382 79,295,562 5,646,804 1,397,284 50,997,780 33,089,079 3,488
Final 21,956,786 161,568,370 4,017,410 5,780,953 83,479,096 6,704,240 2,996,220 52,731,817 37,767,193 3,811
663
Actual Amounts on
Comparable Basis 14,246,955 129,805,337 2,408,743 4,741,852 27,122,260 4,532,165 2,602,366 23,842,189 23,140,816 3,683
Actual 7,709,830 31,763,033 1,608,667 1,039,101 56,356,836 2,172,075 393,855 28,889,628 14,626,377 128
NET RECEIPTS/
(PAYMENTS)
Original (22,027,457) (144,881,630) (3,769,666) (5,532,864) (55,413,738) (4,662,362) (1,390,840) (45,957,569) (33,089,079) (3,488)
Final (21,793,151) (161,483,567) (3,953,534) (5,363,006) (60,385,569) (5,681,511) (2,990,025) (47,549,999) (37,767,193) (3,811)
Actual Amounts on
Comparable Basis (14,031,535) (129,724,594) (2,331,360) (3,937,981) (779,642) (3,144,861) (2,599,028) (20,891,723) (23,140,816) (3,683)
Actual (7,761,616) (31,758,972) (1,622,174) (1,425,025) (59,605,927) (2,536,650) (390,998) (26,658,275) (14,626,377) (128)
Metropolitan
Commission
Civil Service Commission Office of the Manila
DEPARTMENT The Judiciary on Human
Commission on Audit Ombudsman Development
Rights
Authority
RECEIPTS
Original 81,820 - 836,071 6,181 - -
Final 82,183 - 870,418 2,481 - -
Actual Amounts on
Comparable Basis 73,173 - 385,182 15,063 - -
Actual 9,010 - 485,236 (12,582) - -
PAYMENTS
Original 32,772,779 1,428,058 11,012,189 2,446,671 750,859 3,766
Final 34,775,513 1,493,260 11,669,353 2,542,506 821,732 2,631,927
Actual Amounts on
Comparable Basis 32,088,269 1,477,823 10,978,129 2,289,724 700,575 1,277,988
664

Actual 2,687,245 15,436 691,224 252,783 121,156 1,353,940
NET RECEIPTS/
(PAYMENTS)
Original (32,690,959) (1,428,058) (10,176,118) (2,440,490) (750,859) (3,766)
Final (34,693,331) (1,493,260) (10,798,935) (2,540,025) (821,732) (2,631,927)
Actual Amounts on
Comparable Basis (32,015,096) (1,477,823) (10,592,947) (2,274,661) (700,575) (1,277,988)
Actual (2,678,235) (15,436) (205,988) (265,365) (121,156) (1,353,940)
COMMISSION ON AUDIT
KEY OFFICIALS
COMMISSION PROPER
Michael G. Aguinaldo
Chairperson
Jose A. Fabia
Commissioner I
Roland C. Pondoc
Commissioner II
Assistant Commissioners
Wilfredo A. Agito
Lourdes M. Castillo
Winnie Rose H. Encallado
Susan P. Garcia
Alexander B. Juliano
Rizalina Q. Mutia
Carmela S. Perez
Manolo C. Sy
Luz L. Tolentino
Elizabeth S. Zosa
NATIONAL GOVERNMENT SECTOR
Susan P. Garcia
Assistant Commissioner
Daria B. Sison
State Auditor V, Officer In-Charge Director III
Cluster 1 – Executive Offices

Sofia C. Gemora – Director IV
Joycelyn R. Ramos – State Auditor V, Officer In-Charge Director III
Cluster 2 – Oversight and Public Debt Management Agencies

Cora Lea A. Dela Cruz – Director IV
Gloria M. Bacani – Director III
Cluster 3 – Legislative, Judiciary and Constitutional Offices

Sisinia H. Estorosos – Director IV
Irene F. Poso – State Auditor V, Officer In-Charge Director III
Cluster 4 – Defense and Security

Irma S. Besas – Director IV
Melissa Grace B. Martinez – Director III
Cluster 5 – Education and Employment

Cecilia B. Camon – Director IV
Elinore C. Lavilla – Director III
Cluster 6 – Health and Science

Martha Roxana C. Sese – Director IV
Estelita B. Catubay – Director III
Cluster 7 – Public Works, Transport and Energy

Janet D. Nacion – Director IV
Marieta V. Andoy – Director III
Cluster 8 – Agriculture and Environment

Ma. Mileguas M. Leyno – Director IV
GOVERNMENT ACCOUNTANCY SECTOR
Office of the Assistant Commissioner

Lourdes M. Castillo
Assistant Commissioner
Atty. Juanita C. Fuggan State Auditor IV, Officer In-Charge Chief of Staff
Luisa S. Nadonga Supervising Administrative Officer
Maricel S. Ampoc Administrative Officer II
Benjie D. Baturi Administrative Aide VI
Magdalena M. Gaviola Administrative Aide IV
Government Accountancy Office

Office of the Director
Villa DJ. Bernaldo
Director IV
Maria S. Sarmiento
Director III
Ma. Belen L. Estuaria Chief Administrative Officer
Mary Jane S. Liberato Administrative Officer II
Rufa L. Gunabe Administrative Aide V
Maria C. Lainez Administrative Aide V
Teddy N. Alejandro Administrative Aide IV
General Accounts Services - National I

Anicia H. Guillermo
State Auditor V
Lorelei L. Datu State Auditor IV
Susan C. Vega State Auditor III
Carol M. Orpia State Auditor II
Bryan B. Viloria State Auditor I
Jannette N. Caluya State Auditing Examiner II
General Accounts Services - National II

Thelma F. Panganiban
State Auditor V
Narcisa S. dela Rosa State Auditor III
Jane L. Maramag State Auditor III
Ma. Corazon D. Eguia State Auditor II
Rodel Joseph Y. Navarro State Auditor II
Earvin John R. Bote State Auditor I
Erwin C. Santos State Auditing Examiner II
Public Debt and Miscellaneous Accounts Services

Marilyn C. Bibat
State Auditor V
Elmer M. Grande State Auditor IV
Visitacion T. Corpuz State Auditor III
Jose Jayson L. Medel State Auditor II
Joseph Emmanuel I. Romero State Auditor I
Luthor Ace C. Villalva State Auditing Examiner II
Local Government Accounts Services
Avelina G. Marquez
State Auditor IV, Officer In-Charge Service Chief
Maribel G. Cablayan State Auditor III
Aida A. Donasco State Auditor III
Joven L. Recto State Auditor III
Elizabeth D. Ducay State Auditor II
Ana Liza G. Balares State Auditing Examiner II
Corporate Government Accounts Services

Editha M. Ramirez
State Auditor V
Ma. Lourdes D. Marayan State Auditor IV
Zenaida P Balmes State Auditor III
Elizabeth P. Quiban State Auditor II
Princess B. Somera State Auditor II
Zosimo C. Gamanos, Jr. State Auditor I
Accounting Systems Development and Other Services Office

Office of the Director
Luzvi Pangan Chatto
Director IV
Elena B. Monteza
Director III (Retired, August 18, 2018)
Annabelle A. Puserio
State Auditor V, Officer In-Charge Director III
Ana Marie D. Gellecanao Supervising Administrative Officer

Editha C. Ramirez Administrative Assistant VI
Lailah D. Chua Administrative Officer II
Marissa D. Labajan Administrative Aide IV
Accounting Systems Development and Other Services - National

Vanessa Donnabel F. Manito
State Auditor IV, Officer in-Charge Service Chief
Pretizel Ivy T. Arteche State Auditor II
Rossmon A. Doroja State Auditor I
Barby Ann G. Laceda State Auditing Examiner II
Berlin M. Quevedo Administrative Officer II
Dessaries T. Gow Administrative Aide VI
Accounting Systems Development and Other Services - Corporate

Annabella P. Gabiran
State Auditor V
Juanita C. Fuggan State Auditor IV (in concurrent capacity)
Mairyl Ann M. Tibulan State Auditor II
Arnel A. Manalastas State Auditor I
Ma. Yvonne J. Regala State Auditing Examiner II
Xezarajjah S. Villanueva State Auditing Examiner II
Accounting Systems Development and Other Services - Local
Carmen Z. Zafe
State Auditor V
Jorgen Z. Fulleros State Auditor IV (in concurrent capacity)
Cristina C. Gungon State Auditor III
Hannah Grace P. Valente State Auditor I
Mhay L. Ondoy Administrative Aide VI
Technical Assistance and Help Desk Services

Romeo C. Cruz
State Auditor V
Jorgen Z. Fulleros State Auditor IV
Michelle M. Gagarra Information Systems Analyst II
Ma. Karizza AA. Cabildo Administrative Officer II
Dianne Nicole G. Gabriel Administrative Officer II
Sarah Joy M. Lambino Administrative Officer II
Lev Justin E. Saclayan Administrative Officer II
Kayla Mae B. Servigon Administrative Officer II
Jenica V. Edoria State Auditing Examiner II
Gabriel B. Mercado Computer Maintenance Technologist I
Jeline G. Esase Computer Maintenance Technologist I
Lara Jane M. dela Torre Administrative Aide VI
Shekinah Roebec M. Osorio Administrative Aide VI
Christian L. Baturi Administrative Aide VI

2017 AFR National Govt Volume I

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FY 2017

Annual Financial Report

Appropriations, Allotments, Obligations, Disbursements, and Balances

1. Registry of Appropriations and Allotments (RAPAL) to record and monitor the

1. Statement of Appropriations, Allotments, Obligations, and Disbursements

National Government Debt

1. Schedule of Commitment Fees Paid;

Summary of Audit Opinions, and Significant and Common Audit

Highlights of Accomplishments of the Top Ten Departments

II APPROPRIATIONS, ALLOTMENTS, OBLIGATIONS,

III CURRENT SURPLUS OF THE NATIONAL GOVERNMENT

IV COMPARATIVE FINANCIAL STATEMENTS

V NATIONAL GOVERNMENT DEBT 228

VI SUMMARY OF AUDIT OPINIONS 238

VII SIGNIFICANT AND COMMON AUDIT OBSERVATIONS AND

VIII HIGHLIGHTS OF ACCOMPLISHMENTS OF TOP TEN

I.A.1 Current Assets 2

II-27 Comparative Unpaid Obligations by Department/Office 41

Chart I.A.1 Financial Position for FYs 2017 and 2016

ASSETS – P5.247 trillion

Current Assets – P1.428 trillion

Chart I.A.2 Composition of Current Assets

Other Current Cash and Cash

Table I.A.1 Current Assets

Non-Current Assets – P3.820 trillion

Chart I.A.3 Composition of Non-Current Assets

Property, Plant and Equipment Investments Receivables

LIABILITIES – P7.105 trillion

Current Liabilities – P1.167 trillion

Table I.A.3 Current Liabilities

The biggest component of current liabilities represents financial liabilities of P987.22

Chart I.A.4 Composition of Current Liabilities

Non-current liabilities increased by P484.23 billion or 8.88 percent compared to the

Table I.A.4 Non-Current Liabilities

Chart I.A.5 Composition of Non-Current Liabilities

Financial Liabilities Other Payables

Table I.A.5 Net Assets/Equity of the National Government

Table I.B.1 Financial Performance of the National Government

Revenue – P2.524 trillion

Chart I.B.1 Total Revenue

3,000.00 266.41 243.53

Current Operating Expenses – P1.538 trillion

100.00 78.43 70.77

Net Financial Assistance/Subsidy – (P802.51) billion

Financial assistance/subsidy to NGAs, LGUs, government corporations (GCs), and non-

Table I.B.2 Net Financial Assistance/Subsidy

Table I.C.1. Accumulated Surplus/(Deficit)

Chart I.D.1 Cash Flows, by Activity

4,500.00 FY 2017 FY 2016

3,000.00 1,050.02 1,340.86

Operating Investing Financing

E. COMPARISON OF BUDGET AND ACTUAL AMOUNTS

Under original budgeted amounts, payments exceeded receipts by P1.124 trillion.

Budget for Fiscal Year 2017

 Accelerate annual infrastructure spending to 5.4 percent of Gross Domestic

 Invest on human capital development

 Provide ample social protection and sustainable livelihood

 Increase agricultural and rural enterprise productivity and rural tourism

 Ensure sustained efficient macroeconomic management

Table II-1 Annual Budget, Fiscal Years 2009 to 2017

Appropriations, Allotments, Obligations, and Disbursements

Overdraft in allotments are obligations incurred by NGAs not covered by allotments or in

Table II-2 Comparative Appropriations, Allotments, Obligations,

Chart II-1 Trend Analysis of Appropriations,