5. Philippine Normal University (continued)
COA recommended that the PNU Administration review its agreement with the MPC, considering that its Memorandum of Agreement (MOA) had already expired; and study the possibility of directly doing service contracts with the stallholders in order to derive rental income for the University.
Other issues highlighted by COA's 2009 CAAR of PNU showed that:
- The PNU Main Campus procured office supplies, construction materials and equipment totaling PhP 11.9 million during the year which were not included in the Annual Procurement Plan (APP) due to poor procurement planning contrary to R.A. 9184.
- COA recommended that the PNU Administration comply strictly with R.A. 9184 regarding procurement planning as failure to comply in future transactions may be disallowed in audit as warranted by the circumstances.
- At the PNU Negros Occidental branch, cash advances amounting to PhP 250,000.00 remained unliquidated at year end due to lack of monitoring contrary to COA Circular No. 97-002 dated February 1, 1997 resulting in the overstating of the receivable account and understating of the related expense accounts. COA recommended that the PNU Administration comply strictly with COA Circular No. 97-002 dated February 1, 1997 regarding the granting, utilization and liquidation of cash advances.
- Out of the total balance of Other Receivables account amounting to PhP 5.7 million at PNU Main Campus, PhP 704 thousand or 12.3 percent remained uncollected for four to ten years as of December 31, 2009, due to poor monitoring of collections from various debtors. COA correspondingly recommended to the PNU Administration to exert extra efforts to collect long outstanding receivables by sending demand letters to its debtors; and effect salary deductions for those employees with outstanding obligations.
- A comparison of the General Ledger balance of Office Supplies Inventory account amounting to PhP 1.34 million as against the physical inventory of PhP 400,000.00 for CY 2009 at the PNU Main Campus, showed a discrepancy of PhP 933,000.00 due to the absence of periodic reconciliation of accounting records against property reports casting doubts on the validity of the said account.
- COA recommended and the PNU Administration agreed to require the Accountant and Property Officer to exert extra efforts to reconcile their respective records to ensure accuracy of the reported account balances in the financial statements and the Accountant to prepare a journal entry voucher to reflect the correct balance of the account.
- The balances of dues from the Central Office account of PhP 3.5 million and Due to Regional/Branch Offices amounting to PhP 17.7 million appearing in the books of PNU Branches and PNU Main campus, respectively as of the end of the year resulted in a discrepancy of PhP 14.2 million, due to a lack of regular and periodic reconciliation, casting doubts on the validity of the said accounts.
- The PNU Administration, upon COA's recommendation, agreed to reconcile the above noted discrepancy on the two reciprocal accounts and henceforth, to conduct regular reconciliation of said accounts to insure the correctness of financial data.
- The Other Payables accounts balance of PhP 46.5 million at PNU Main Campus could not be ascertained as PhP 10 million could not be verified due to the absence of records and the existence of a negative balance amounting to PhP 57,000.00, casting doubts on the existence and validity of the account. This resulted in COA's recommending that the PNU Administration instruct its Accountant to exert extra efforts to look for documents that will identify the nature of the accounts in the subsidiary ledger in the total amount of PhP 10,079,500.91; and review and analyze the accounts with negative balances which may represent excess expenditure over the amount earmarked for the program or project and immediately prepare journal entry vouchers to correct the recording.
COA said the above observations and recommendations were discussed with the PNU Administration whose comments were incorporated in the 2009 CAAR where appropriate.
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