COA: City not adopting our recommendations

CEBU, Philippines - The Commission on Audit said Cebu City officials appear not to be serious in complying with their recommendations in correcting their violations in the city’s financial transactions.

It was found out that of the 13 audit recommendations embodied in the COA annual audit report for 2007, only one was so far fully implemented by the city, five partially implemented and seven ignored.

The only recommen-dation that was fully complied with by the city is the request for punctual submission to the city auditor the copies of all perfected contracts and purchase orders within five working days after the approval.

The state audit procedures also require the submission of the notices of deliveries, inspection and acceptance reports within 24 hours from receipt of goods and acceptance of items.

But COA-7 regional director Delfin Aguilar said until now the liquidating officers of the city still failed to strictly comply with the procedures by properly reviewing the collection reports of the collection agents.

Aguilar said reports of cash examinations still showed deficiencies in the records of collectors like missing receipts under remittances, thus the explanations of liquidating officers that they reviewed the remittances are proven otherwise.

COA also noted that the city still made some purchases that are charged against the different trust fund accounts. The acting city accountant reportedly assured the COA to make adjustments, but reportedly did not.

The city officials also failed to compel 26 barangays to liquidate the P2.6 million that were granted to them at P100,000 each months before the holding of the ASEAN summit in January 2007.

The state auditors insisted that the liquidation report is necessary to determine whether the public funds were spent for government purposes by those officials entrusted with them.

Mayor Tomas Osmeña granted the barangays the amount to be spent for holding any activity in their place so their constituents will not go to the city. This was seen as one way to make the security control much easier during the summit.

The COA also recommended that there should be a specific office in the city government tasked to monitor and require the submission of liquidation documents to guarantee the proper utilization of funds granted to non-government and people’s organizations.

The city officials just said that there was only little financial assistance to NGO and POs because of the implementation of COA Circular 2007-001 that prohibits the granting of financial assistance to organizations whose officers are also officials of the city.

Although the non-compliance of the provisions as provided for under the Government Accounting and Auditing Manual can be considered criminal offense COA has no plan to sue the city officials.

“The Commission on Audit should know better,” said Osmeña of some of the findings of COA’s Annual Audit Report for 2008.

Osmeña in yesterday’s press conference said that there are some findings of COA which were suppose to be given already.

“They are COA, they should know better. They give these certain comments which are…I don’t know,” he said.

COA recently said that Cebu City also exceeded its limitation for debt servicing payments set by the Local Government Code.

Cebu City last year paid P729 million which is way past the P356 million allowed by law.

“I don’t know all the details but which is more important, should we pay it or not, we pay na lang else we loose 300 hectares of land,” Osmeña said, referring to the South Road Properties.

He said it should also be mentioned that the national government, through their loan from Japan, benefited P200 million annually from it even if SRP was not earning yet.

When the loan obtained from Japan was granted, it passed by Department of Finance and placed a one-percent interest rate.

It was then released through Land Bank of the Philippines which charged another two percent.

“Sure we are considering other banks if they want to buy out the loan and charge a lesser interest, like one percent,” he said.

Because of the overpayment on debt servicing, COA pointed out that it may jeopardize the provision of basic services.

“Now that for me is plain politics, a propaganda. Prove it, open your eyes. I have not reduced any appropriation for basic services,” Osmeña said.

He said the city has given dump trucks and garbage trucks to barangays, paid for the fuel and even gave money for its drivers.

“I just won an award for best malnutrition program, best barangay justice system, the dengue reduced by 50 percent, aren’t those basic services?” Osmeña said.

The Cebu City Medical Center still received its annual P50 million appropriation and he even approved an additional P21 million requested by Vice Mayor Michael Rama.

On his usage of PAGCOR funds for other purposes, the mayor said he asked PAGCOR’s permission before the funds are released.

As to his spending of his discretionary funds and requiring him to submit its attachments and documentations even from previous years, Osmeña called such requirement as “unfair”.

“There are several times that I do things and not charge it to City Hall, there are just visitors who contribute to the city their services for free and sure we take care of their accommodations. But I cannot reconstruct all of these for the last three years or so,” he said. – Rene U. Borromeo and Ferliza C. Contratista/BRP (THE FREEMAN)