Daily TribuneCoA’s 2022 report said it found various accounting errors and omissions in the DBM accounts that resulted in misstatements totaling P235.102 million in some assets, liabilities and equity accounts of its financial statement
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Of all the government agencies, the expectation is that the Department of Budget and Management, or DBM, must have the best accountants and financial aces in government.
The Commission on Audit, or CoA, questioned the capabilities of its staff, which, in turn, raises questions about the accuracy of the fiscal numbers.
CoA's 2022 report said it found various accounting errors and omissions in the DBM accounts that resulted "to the misstatements totaling P235.102 million in some assets, liabilities and equity accounts" of its financial statement.
It cited section 15, Chapter 2, Volume I of the Government Accounting Manual for National Government Agencies, which stated that the financial statements must present fairly the financial position, performance, and cash flows of a government outfit.
"Fair presentation requires the faithful representation of the effects of transactions, other events, and conditions in accordance with the definitions and recognition criteria for assets, liabilities, revenue, and expenses," CoA reminded.
Yet, CoA said an analysis of the accounts and the related journal entry vouchers supporting documents for the calendar year 2022 of DBM central and regional offices "revealed accounting errors arising from omissions, erroneous recognition and misclassifications."
Overall, the errors resulted in the overstatement of assets and equity by P42.201 million and P112.833 million, respectively, with the corresponding understatement of liabilities by P70.632 million, the CoA pointed out.
State auditors also underlined section 30, Chapter 2, Volume I of the manual that "an entity shall present information including accounting policies in a manner that meets a number of qualitative characteristics such as understandability, relevance, materiality, reliability, and comparability."
An indicting statement from CoA to DBM was its assessment that the "qualitative characteristics are the attributes that make the information provided in the financial statements useful to users."
CoA then lectured DBM on the tools to arrive at accurate financial numbers.
It said one of the types of control activities is reconciliation, "which compares two or more data elements and if differences are identified, corrective action is taken to bring the data into agreement."
The process generally addresses the completeness and accuracy of processed transactions, CoA added.
Moreover, the auditing agency expressed doubts on the existence, completeness, and accuracy of the balances of several assets and liabilities totaling P1.055 billion was not ascertained due to accounting deficiencies such as variances between books of accounts and related records and dormancy of some accounts totaling P208.879 million.
CoA indicated that the same issues were raised previously, but the DBM failed to resolve these.
"Despite inclusion of similar audit observation in the previous year and efforts exerted by management (DBM) to reconcile the accounting records and Report on the. Physical Count of Property, Plant and Equipment, "the net discrepancy even ballooned to P192.244 million in 2022, or an increase of P188.433 million from the previous year's figure of P3.811 million."
It said that due to the failure to reconcile the property, plant, and equipment account balances with the physical count, the completeness and accuracy of the affected accounts' year-end balances were not ascertained.
CoA certainly is not a fan of the DBM when it comes to keeping financial records, which is regrettable since the DBM drafts the yearly allocations for the entire government.
More CoA problems
So-called pocket parks in Metro Manila, or the inconspicuous Landscape Treatment Pocket Park under the flyover center island at Edsa-Kamias, Kamuning up to Timog Avenue, cost the government a staggering P33.2 million, according to an inquisitive Tarseeto.
The project is estimated overpriced by P25 million; while the pocket park at Edsa Santolan flyover cost taxpayers P24 million, or an alleged overprice of P14 million; the Pocket Park at Edsa-Ortigas Avenue cost P29.6 million in people's money, overpriced by P20 million.
A similar project at the Buendia flyover cost the Metropolitan Manila Development Authority or MMDA, P13 million allegedly overpriced by P8 million; the Valenzuela Friendship Park, which cost the government P20 million, was allegedly overpriced by P12 million; the rehabilitation of Catmon People's Park in Malabon which cost P12 million was allegedly overpriced by P7 million; and the rehabilitation of Hulong Duhat Plaza in Malabon which was paid by MMDA P8 million has an estimated P5 million overprice.
