Francis Jay N.

Enriquez
PUP Sablayan Branch

Review of Annual Audit Report for the Province of Occidental Mindoro (2019).

The Financial Status of the province of occidental mindoro observed an increase in the
financial position from the previous years with province Assets increase a 362,378,370.89Php,
Liabilities 91,014,673.33Php and Equity 271,363,679.56Php. we can say that the province
maintained a good balance on the financial position based on the given figures. The Financial
Performance of the province seen an increase in Income at 119,101,239.00Php as to compare to
last year report meanwhile there was also a decrease in expenses at 69,268,037.54 this will lead
to an excess of income over expenses at 188,369,276.54 as to compare last year. The
appropriations, Obligations and balances shown also an increase from last year’s financial report.
This means that the province generated more income with lesser expenses during 2019
period. This highlights also show an increase in economic activity in the province opening more
businesses to have an increased income but conservatively expense the budget properly.
The auditor rendered a qualified opinion based on the fairness of the presentation of the
financial statements of the province as of year-end. This are due to:
a. unrecognizing receivable net of collection as Loans Receivable Account to avoid overstated of
total amount and understated the balance.
b. not Assessing receivables from officers and employees, NGA’s and NGO’s any objective
evidences that were impaired.
c. the inclusion in the account of property, plant and equipment of other infrastructure asset
wherein projects were turned over to the respective LGU’s thus overstating the former accounts
and Government equity.
d. the unreconciled accounts of land improvement and property records that casts out uncertainty
on the accuracy of account balance as of year-end.
With these cited exemption on the report the provincial government of occidental
Mindoro should follow the recommendation of the Auditor to have the provincial accountant to
make an adjustment on the transfer of loans from 2018 to 2019 instead of recording as MOOE to
Loans receivable accounts, make an assessments on the objective evidences that the receivables
are impaired as a result of impact in collectability of receivables and to recognized impairment
loss. Develop a journal entry voucher for the transfer of projects from provincial government to
the respective LGUs and with the general services officer to exert extra effort to identify causes
of disparity in the account balance for proper disposition.
 The Annual Audit Report for the province of occidental Mindoro added other significant
observation and recommendations in the audit of accounts and transactions for the year 2019.
The report shows failure of the PGOM to manage its funds efficiently. Funds in the government
our its blood that supports its flow of administration. The PGOM financial committee should
established a systematic plan of accounting receivables and obligation and manage its cash flows
into its equilibrium. Cash advances are good when properly audited and documented but can also
be bad if not properly used and audited based on its declared usage advances should be
liquidated immediately pursuant to COA circular No. 97-002. Proper identification of signatories
on the accountabilities should be taken into legal documentation. The PGOM legal officer should
maintain the integrity inside the government office.
The report also noticed a non-moving dormant account that generated uncollected
receivables that merely affects the continuity of livelihood program. The COA advised complete
and precise submission of loans that were released and further instructed the provincial treasurer
to checked and collect long overdues receivables. Financial stability of a government office lies
in the proper auditing and accounting of payables, receivable and loans. As directed by the COA
the review of the validity of unliquidated obligations should be prioritized to avoid discrepancies
and imbalances on the financial status.
The report also exposed the inadequacy in the supporting documents on the wages of job
orders and consultants such obligation to address those documentation is under the PD no. 1445
known as government auditing code of the Philippines and COA Cir. No. 2012-001 to avoid
irregularity that can cast doubts on the payment of wages. The provincial accountant together
with the human resource should make a systematic approach in doing ease of documentation on
the job orders and consultants position of employees in the PGOM, such that those legal and
binding documents will present real time and granular actual service rendered of the mentioned
position.
The discrepancies and irregularities on the procurement were reported such those
procurement is under the Bids and Awards committee, one of the reasons why irregularities
happened was because of very stiff bidding process in the province. The PGOM should ordered
Bids and awards to committee to establish a systematic selection of bids and awards to make it
more accessible to other bidders and to properly review first the documents and the product that
was bid. This was legalized under the revised IRR of RA 9184 and further elaborated on COA
Circular No. 2012-001 Sec 9.1.3 to review the Completeness and check the integrity of
supporting documents of DV.
Some of the significant report about the difficiencies and irregularities in the
infrastructure projects and funds for PDRRMO, such those delinquencies should be the subjects
of updating the status infrastructure projects making sure to suspend irregularities and blacklist
all the contractors who failed to deliver proper services on time. With the funding of LDRRMF
updates on the PPA and inclusion of unexpended PPAs should be monitored for timely
implementation of programs, project and activities that will lessen the effect of risk and hazards
towards the community.

This annual audit report exposed that of 40 recommendation from the previous 2018
AAR, 12 were fully implemented, 22 were partially implemented and 6 were not implemented,
during the year of 2019 the change of administration happened in the mid quarter of the year thus
limiting the targeted time for a newly elected official to implement audit recommendation. The
recommendations of the COA based on 2019 AAR needed a whole of provincial governmental
approach with a systematic generation of documents. The culture in the PGOM changes upon the
arrival of Gov. Ed Gadiano delivering participatory style of government which will answer all
those recommendation on this 2019 AAR making sure that all department are on resonance in
doing their work and report as stated in the law. As a reviewer of the 2019 AAR I noticed that
the problem starts simply on the mismanagement or wrong documentation of public funds. Such
those will greatly affect the balances of financial statements, also the unsystematic way of
liquidating cash advances and projects making it difficult to manage public funds and thus will
create spaces of more unliquidated finances and obligations.
To give a fair opinion, the PGOM was somehow on their track in establishing a strong
financial status of the province given the changes and the participatory leadership of Gov.
Gadiano, notices of increase in PGOM financial status was somehow remarkable on his
leadership. It’s a fair to conclude that given the limited time of a month some of its balances and
loans are paid nor adjusted and more recommendations are taken into considerations. With a
strong support of the financial committee those discrepancies will somehow be resolved and
devlop into a more sustainable way.