2009 COA Report Dalaguete exceeded budget by over P13 million

CEBU, Philippines - The Commission on Audit found that the southern town of Dalaguete has incurred an overdraft amounting to over P13 million in 2009, which violates the Local Government Code.

An overdraft is defined as the amount by which withdrawals exceed deposits or the extension of credit and/or the act of overdrawing a bank account.

In its annual report, COA said Dalaguete had an appropriation of P35,910,452.24, but its total financial obligations from January 1 to December 31, 2009 for Personal Services, Maintenance and other operating expenses, Capital Outlay, Non-Office Expenditures and Financial Expenses reached P49,533,691.79, incurring an overdraft of P13,623,239.55.

COA said the act of incurring overdraft in appropriation violates sections 305(a) and 336 of the Local Government Code, which may subject to civil and administrative sanctions

Section 305 (a) says “No money shall be paid out of the local treasury except in pursuance of an appropriations ordinance or law.”

Section 336 states that the use of appropriated funds and savings funds shall be available exclusively for the specific purpose for which they have been appropriated.

What happened in Dalaguete, COA said, is that the municipal mayor, municipal budget officer and other officials and employees were warned to stop the incurrence of overdraft in appropriation, but the officials reportedly neglected the warning when the municipal budget officer continued signing the Obligation Request while the municipal mayor kept on approving the Disbursement Vouchers for payment of expenditures even if the appropriations were already exhausted.

COA recommended that the local government unit stop incurring expenditures beyond its budget and strictly observe the law to avoid sanctions.

COA also recommended that the Municipal Council pass a resolution to authorize an augmented the appropriated budget if and when necessary. (THE FREEMAN)