COAble: List of Common COA Audit Findings,

Observations, Suspensions, Disallowances —

Listed hereunder are the common audit findings, observations, suspensions, disallowances
issued/imposed by the Commission on Audit (COA) on cash advances.

1. Advances for Payroll were not liquidated at the end of the year, contrary to COA
Circular No. 97-002 dated February 10, 1997.
What you can do: Instruct the disbursing officer to return the unused cash and/or to submit all
documents to fully liquidate his/her cash advances at the end of the year to comply with COA
Circular No. 97-002 dated February 10, 1997.
[Source: Commission on Audit]

2. The granting of cash advances to officers and employees was not adequately controlled
resulting in the accumulation of outstanding cash advance balances contrary to the
provisions of Section 89 of Presidential Decree No. 1445.
What you can do: (a) issue demand letters to (i) notify the concerned officials and employees of
their responsibility to settle their unliquidated cash advances. If settlement was not received,
withhold from their salaries considering that they have been notified and given more adequate
time to liquidate; (ii) employees who already resigned and transferred to immediately cause the
liquidation or settlement of the unliquidated balances; (b) request the write-off of the
unliquidated cash advances balances of the dead employees; (c) ensure the completeness of
prescribed supporting documents for the granting of cash advances in processing claims for
payment thereof; (d) do not grant additional cash advance to concerned officials and employees
unless the previous cash advance granted them have been liquidated; (e) do not process cash
advances other than for official travel/purpose; (f) strictly monitor periodically the submission of
liquidation reports to ensure timely accounting thereof to avoid undue accumulation of
outstanding cash advances; and (g) strictly comply with the provisions of the Circulars pertaining
to cash advances.
[Source: Commission on Audit]
3. Non-compliance with the rules and regulations on cash advances as prescribed under
Section 89 of PD No. 1445, and pertinent Sections of COA Circular No. 97-002 dated
February 10, 1997 and GAM Volume I, resulted in control weaknesses over the granting,
utilization and liquidation of cash advances.
What you can do: (a) stop the practice of granting additional cash advance to Accountable
Officers (AOs) and personnel who still have unliquidated cash advance/s; (b) refrain from the
practice of transferring cash advances of AOs to other officers/personnel who actually need the
cash, but instead, require them to be adequately bonded in accordance with law; (c) undertake
full information dissemination for the immediate liquidation of cash advances; (d) submit
Liquidation Reports for cash advances obtained for official travels, seminars/trainings within the
prescribed period; and (e) take appropriate action for the full settlement of the year-end balance
of unliquidated cash advances.
[Source: Commission on Audit]

4. Cash Advances for local and foreign travels were not liquidated within the prescribed
period after return to their permanent official stations.
What you can do: Ensure that all cash advances for local and foreign travels are liquidated within
the prescribed period. COA Circular No. 97-002 February 10, 1997 (Rules and Regulations on
the granting, utilization and liquidation of cash advances) provides that cash advances for official
travels shall be liquidated as follows: “(xxx) within sixty (60) days after return to the Philippines
in the case of foreign travel or within thirty (30) days after return to permanent official station in
case of local travel.”
The same period is also prescribed in Section 22 Executive Order No. 77 — the latest legal basis
for the grant of traveling allowances for government personnel.
[Source: Commission on Audit]

5. Additional cash advances were granted to officials and employees without liquidating
previous cash advances.
What you can do: Refrain from granting additional cash advances without first liquidating the
previous cash advance. Section 4.1.2 of COA Circular No. 97-002 dated February 10, 1997
provides that: “No additional cash advances shall be allowed to any official or employee unless
the previous cash advance given to him is first settled or a proper accounting thereof is made.”
[Source: Commission on Audit]

6. The grant of cash advance and the liquidation thereof were not supported with proper
and complete supporting documents.
What you can do: Ensure that the documentary requirements prescribed under COA Circular No.
2012-001 dated June 14, 2012 (Revised Documentary Requirements for Common Government
Transactions) and other pertinent issuances concerning cash advances were properly complied
with.
7. Granting of cash advances to personnel without the required fidelity bond.
What you can do: Refrain from granting cash advances to accountable officers without first
securing them with Fidelity Bond, pursuant to Section 101.2 of PD 1445.

8. Cash advances for traveling allowances were granted without appropriations in violation
of Section 4 of P.D. 1445.
What you can do: Ensure that the granting of cash advances shall be limited to those with
available appropriations. Section 4.1 of PD 1445 provides that no money shall be paid out of any
public treasury or depository except in pursuance of an appropriation law or other specific
statutory authority. In cases where the appropriations are no longer sufficient to cover any
expenditure, an appropriation act/ordinance, shall first be passed and approved before payment
of said expenditure be effected.

9. Contractual employees were given cash advances contrary to existing rules and
regulations.
What you can do: Avoid granting cash advance to non-permanent employees to avoid
unnecessary loss of government funds. Pursuant to existing rules and regulations, only
permanently appointed officials and employees shall be granted cash advance. Take note that the
employment of contractual employees solely depend on the renewal of their Contract of Service.
Abrupt resignation or absence without official leave of these employees may result to
permanently unliquidated cash advances.
[Source: Commission on Audit]

10. Deducting unsettled cash advances against the salary of employees concerned
What you can do: The practice of salary deduction from unsettled cash advances is contrary to
the provisions of COA Circular No. 97-002, which requires prompt liquidation of cash advances.
Avoid said practice and implement the appropriate process of liquidating cash advances.