About P1.65 billion in funds transferred by the Department of Transportation and Communications (DOTC) to various government agencies, corporations and units– including funds that have been unsettled for a year to over 10 years–remained unliquidated as of year-end 2013, state auditors said.
Based on the 2013 audit report on DOTC by the Commission on Audit (COA), DOTC-Proper has a total of P1,640,091,818.32 outstanding inter-agency receivables while the Land Transportation Office (LTO) has P2,948,683.40 and the Land Transportation Franchising and Regulatory Board (LTFRB), P4,129,210.70 that amount to P1,647,169,712.42.
“Audit showed that of the total unliquidated balance of P1,640,091,818.32 in the books of the DOTC as of December 31, 2013, 84.28 percent or P1.382 billion have been outstanding for more than one year to over ten years,” the auditors said.
“The funds amounting to P1,382,295,775.69 transferred by DOTC to various NGAs, GOCCs and LGUs remained unsettled from one year to over ten years as of December 31, 2013 due to the failure of management to compel the concerned agencies to settle their accountabilities and the practice of management to grant additional fund transfers without requiring the Implementing Agencies (IAs) to first liquidate their balances,” they added.
NGAs stand for national government agencies; GOCCs, government -owned and -controlled corporations; and LGUs, local government units.
The state auditors cited COA Circular 94-013, which provides that within 10 days after the end of each month or agreed period for the project, the IAs shall report the utilization of the funds transferred by submitting the Report of Checks Issued (RCI) and the Report of Disbursement (RD).
“In addition, the Memoranda of Agreements (MOA) with concerned government agencies contained the terms and conditions governing the receipt, utilization and liquidations of the funds transferred,” they said.
According to the audit report, the fund transfers were meant for implementation of various projects since 1985, some of which have long been completed.
But because of the non-liquidation of the fund transfers, “the corresponding assets could not be recognized in the proper accounting period,” the auditors said.
“Analysis disclosed that DOTC failed to monitor the submission of liquidation reports by the IAs contrary to COA Circular 94-013 which resulted in the accumulation of unsettled receivables. Additional fund transfers were, likewise, granted to IAs with unliquidated balances,” the auditors observed.
The audit team has told and the DOTC agreed to “strictly adhere” to guidelines on the grant, use and liquidation of fund transfers as well as the provisions of the MOA with concerned IAs to make “a strong representation” with its officials to submit liquidation reports.
And if for any reason such is no longer possible, the state auditors also told the agency to require the IAs to certify that the projects had been implemented and recorded in their books of accounts, duly verified by their respective auditors from COA.