Thursday, July 10, 2008 City told: Find P102M in property By Garry A. Cabotaje Sun.Star Staff Reporter
AN inventory report of property, plant and equipment (PPE) that cannot be reconciled with the City’s property records continued to bug the Talisay City Government.
This deficiency resulted in the “unreconciled” difference of P102 million in the PPE account and P8.8 million in the inventory account, according to the Commission on Audit (COA) 2007 report.
It said the City’s failure to submit a complete PPE inventory report and to reconcile the accounting and supply officer’s property records “casts doubts on the reliability of the said accounts in the financial statements.”
COA noted that the General Services Office (GSO) failed to submit the required report of the physical count of the City’s various properties, equipment and facilities for the general fund, trust fund and special education fund (SEF).
2006 only
What were submitted to the state auditor last Feb. 20 covered only calendar year 2006 and only for accounts like office equipment, medical and dental gadgets, motor vehicle inventory, furniture and fixtures, disaster and firefighting equipment accessories, communication equipment, appliances and IT (information technology) equipment and software.
Although the GSO submitted the inventory reports for 2007, COA noted that there was no physical inventory conducted for PPE for 2007.
“The inventory report prepared was based on physical inventory conducted in 2006 and based on the acknowledgement receipt of equipment (ARE) on file at the GSO
office,” it said.
It said that “comparison between the totals per inventory report submitted against the balance per books of PPE and inventory account revealed substantial unreconciled differences of P102,178,454.12 and P8,807,442, respectively.
The COA said the lapse was caused by the non-reconciliation between the records of the City Accounting Office and GSO.
Different inputs
These two City Hall departments used different input documents in recording the acquisition of property, it said.
While the accounting office used the purchase order in recording the acquired property upon receipt of paid vouchers, the GSO used the ARE as input documents in recording PPE.
Because there was no actual physical count of properties, COA said that difficulties were expected in “ascertaining the existence of the recorded asset in the financial statements.”
The COA revealed that it already sent an Audit Observation Memorandum to the GSO about the deficiency.
The GSO replied that its physical count of PPE for 2007 “is still ongoing” and that it already began reconciling its records with the accounting office.
State auditors cited Section 124 of the New Government Accounting System (NGAS) manual, which mandates the local chief executive to require periodic physical inventory of supplies or properties.
It said the report of physical count of inventories shall be submitted to the assigned state auditor not later than July 31 and Jan. 31 of each year for the first and second semesters, respectively.
Sun.Star Cebu tried to contact GSO Chief Joan Vebar for comment but was told that she was attending a seminar in Cebu City. City Accountant Viluzminda Villarante also could not be reached for comment yesterday.
The COA directed Villarante and Vebar to reconcile their records regularly and to use a uniform set of documents in recording property.
