Seven local government units were found to still have unliquidated cash advances as of the end of calendar year 2023, the Commission on Audit’s audit reports for Catanduanes towns stated.
The largest amount in unliquidated advances, over P2.8 million, was discovered in Pandan, where P625,274.52 had accumulated from prior years and P2,217,810.26 in 2023, incurred mostly by accountable officers, employees and Sangguniang Bayan members for salaries and wages as well as official travel.
The audit team blamed the accumulation of unliquidated cash advances to the management’s non-compliance with the procedures, rules and regulations.
It said the inability to settle CAs creates doubt or impression that the fund may have been utilized for personal purposes as they remained in the hands of the Accountable Officers for a considerable period of time, exposing the resources of the agency to the risk of misuse or misapplication.
The COA recommended that the municipal mayor issue an order requiring concerned officials and employees to immediately settle the CAs, enforce the withholding of salaries of those unable to settle the CAs, and instruct the legal officer to file appropriate legal action against former LGU officials, the estate of the deceased officials or employees, and non-complying officials.
During the exit conference with the audit team, the OIC-Municipal Accountant said that most of the incumbent officials have already liquidated their outstanding cash advances, with majority of the balance not settled by persons who are no longer in the service of the LGU.
In Bagamanoc, the same recommendation was made to the local chief executive over the non-settlement of P271,689.72 of the outstanding balance in unliquidated cash advances for 2023.
Ten officials were responsible for the unsettled advances, majority of which were spent during attendance in seminars, trainings as well as P40,000 for the purchase of toys.
Other LGUs with unliquidated CAs in 2023 were the town of Viga, with ₱277,504.38 remained unreturned by 22 officials and employees; Panganiban, with P150.267.43 in CAs for travel expenses; San Miguel, with P76,401.67, of which almost all is the responsibility one official for travel expenses; and Bato, with 13,117.24 in advances of four employees.
Two LGUs – Virac and Bato – were commended by COA for their high rate of liquidation of cash advances, especially for payroll expenditures.
In the capital town, the audit team appreciate the effort of the agency, especially the Municipal Accounting Office, in monitoring the settlement of cash advances granted.
The Virac LGU achieved a liquidation rate of 99.95% for over P45 million in advances granted, leaving just P20,520 still to be settled.
Higher praise was reserved for the municipality of Bato, which fully liquidated all cash advances for wages and field operations totaling ₱44.05 million as of December 31, 2023.
“Throughout the year, the Municipal Treasurer religiously monitored all cash advances for payroll and field operations and ensured timely liquidation of the same,” the COA stated. “This commendable practice ensured the proper accounting of funds and protection of government funds from loss and misappropriations.”
On the other hand, three LGUs came under scrutiny for cash advances made on their Confidential Funds.
Bato LGU’s P62,500 cash advance for the CF made in late December 2023 was allocated for peace and order maintenance activities until March 2024. The audit team stressed that the CF funds are allocated by quarter and any cash advance should be utilized within the same year.
In San Miguel town, cash advances for Confidential Funds (CF) amounting to ₱83,000.00 remained unliquidated as of yearend 2023 while the amount allocated for CF totaling ₱182,363.69 exceeded the allowable amount by ₱50,682.80 due to the inclusion of activities in the Peace and Order Program (POP) which do not directly address criminality, armed conflict and human rights violation.
The capital town of Virac had an even bigger unliquidated CA for Confidential Funds (CF) amounting to ₱375,000 granted for the conduct of confidential activities.