The Commission on Audit has flagged the Panganiban municipal government’s procurement of medicines from an establishment which has yet to show if it is eligible to supply medicines as part of its business activity.
In its post-audit of 2021 transactions in the local government unit, the audit team found out that some of the medicines procured for stocking in the Rural Health Unit (RHU) were purchased from a business establishment other than a pharmacy or a pharmaceutical company.
The report showed that the company was paid a total of P179,131.00 for the purchase of various medicines in September, October and December 2021.
The team requested from the LGU the submission of the copy of the company’s Certificate of Business Name Registration (BNR) issued by the Department of Trade and Industry (DTI) together with the approved Business Name Registration for Sole Proprietorship Application Form.
It said this would check the establishment’s Philippine Standard Industrial Classification (PSIC) which discloses their approved business activity and the product handled and services rendered.
The auditors noted that even the BAC Chairman wanted to ensure that the goods or medicines being procured must have been included in the supplier’s list of business applied with the DTI, as clearly stated in the Request for Quotation.
According to the report, the LGU submitted the BNR Certificate of the establishment but it lacked the approved BNR for Sole Proprietorship Application Form. It claimed that the same document was requested from the DTI but it was not yet received as of time of the report.
Pending the document’s submission, the audit team stressed that it cannot check whether the supplier was licensed to engage in the sale of medicines, hence, the propriety as to the legal documentation of the disbursements made on the purchase of medicines were not yet verified.
In another finding, the team said that 14 projects under the 20% Development Fund were not completely implemented in CY 2021, with the LGU failing to attain the desired socio-economic targets and outcomes for the year.
In CY 2021, the LGU allocated P14,775,851.00 for development projects under the 20% DF, aside from the P2.27 million continuing appropriations, for a total allocation of P17 million available for 18 identified projects.
However, as of Dec. 31, 2021, only four of the 18 projects were completed, while the 14 others were not implemented, it said.
The team also noted that the supposed date of completion of the Rehabilitation of Local Roads-Reblocking of Sto. Santiago Municipal Road was on Nov. 17, 2021. However, as of year-end the cost incurred of P194,801.52 represents only the 15% mobilization for the project, which was still on-going at the time of the audit.
“Aside from the seven projects which were not completed during the year, there were also seven projects wherein the implementation was not even started in CY 2021,” the COA pointed out.
Under the continuing appropriations, the projects for implementation did not only include those from CY 2020 but also those from CY 2019 and 2017, which is already considered a long duration of implementation for short-term projects, it added.
This indicated a lack of proper planning on some of the 20% DF projects and likewise were not procurement-and-implementation-ready, it stressed.
In response, the Municipal Planning and Development Office explained that the non-implementation of the Road Opening and Concreting of Murphy Road Extension was due to the long processing time of the documents of two lot owners residing in the USA.
He assured that the other projects which were not implemented in CY 2021 will be fully implemented in 2022.
Among the other significant findings in the 2021 Annual Audit Report for Panganiban are the following: charging of invalid expenditures totaling P117,000.00 to the Local Disaster Risk Reduction and Management Fund (LDRRMF); low implementation rate of four LDRRMF programs and projects and 13 Gender and Development (GAD) programs and projects; and, failure to fill up six funded plantilla positions in the LGU.